A Young Chef Is Considering Opening His Own Sushi Bar

question 128

Multiple Choice

A young chef is considering opening his own sushi bar.To do so, he would have to quit his current job, which pays $20, 000 a year, and take over a store building that he owns and currently rents to his brother for $6, 000 a year.His expenses at the sushi bar would be $50, 000 for food and $2, 000 for gas and electricity.What are his explicit costs?

• A)$26, 000
• B)$66, 000
• C)$78, 000
• D)$52, 000
• E)$72, 000

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Definitions:

Absolute Advantage

The ability to make something using fewer resources than other producers use.

Comparative Advantage

The ability of an individual, company, or country to produce a good or service at a lower opportunity cost than competitors, leading to more efficient production and trade.

Absolute Advantage

The capability of a country, individual, or company to produce a greater quantity of a good or service with the same amount of resources as another entity.

Pens

Writing instruments used for applying ink to a surface, typically paper, for writing or drawing.