Jane grows apples on land she inherited from her grandmother. She incurs explicit costs of $200 for the trees and $60 for fertilizers. In addition, suppose her land is otherwise worth $9,000 and her labor is worth

$20,000 (this is the amount she could earn managing someone else's land instead of her own). The market price of apples is $36 per box. If at this price Jane produces 1,500 boxes of apple then her economic profit is

Question

Kaylee Mccann

Business

11 September, 04:10

Jane grows apples on land she inherited from her grandmother. She incurs explicit costs of $200 for the trees and $60 for fertilizers. In addition, suppose her land is otherwise worth $9,000 and her labor is worth

$20,000 (this is the amount she could earn managing someone else's land instead of her own). The market price of apples is $36 per box. If at this price Jane produces 1,500 boxes of apple then her economic profit is

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Answers (1)

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Nolan Pruitt · Answer 1

Economic profit = $24,740

Explanation:

Giving the following information:

Jane grows apples on land she inherited from her grandmother. She incurs explicit costs of $200 for the trees and $60 for fertilizers. The market price of apples is $36 per box. At this price, Jane produces 1,500 boxes of apple.

Suppose her land is worth $9,000 and her labor is worth

$20,000.

Sales = 54,000

Fixed costs = 260

Opportunity cost = 29,000

Economic profit = $24,740