The Table Below Provides the Total Revenues and Costs for a Small

question 85

Multiple Choice

The table below provides the total revenues and costs for a small landscaping company in a recent year. $\begin{array}{|l|l|}\hline \text { Total Revenues }(\$) & 250,000 \\\hline & \\\hline \text { Total Costs }(\$) & \\\hline \text { wages and salaries } & 150,000 \\\hline \text { risk- free return of } 2 \% \text { on owner's capital of } \$ 20 & 400 \\000\\\hline \text { interest on bank loan } & 1500 \\\hline \text { cost of supplies } & 27000 \\\hline \text { - depreciation of capital equipment } & 8000 \\\hline \text { additional wages the ow ner could have earned } & 30,000 \\\text { in next best alternative }\\\hline \text { risk premium of } 4 \% \text { on owner's capital of } \$ 20&800\\000\\\hline\end{array}$
$\text { TABLE 7- } 2$
-Refer to Table 7- 2. The implicit costs for this firm are

• A) $800.
• B) $31 200.
• C) $30 800.
• D) $400.
• E) $30 400.