Pete Owns a Shoe-Shine Business

question 108

Multiple Choice

Pete owns a shoe-shine business. Which of the following costs would be implicit costs?
(i) shoe polish
(ii) rent on the shoe stand
(iii) wages Pete could earn delivering newspapers
(iv) interest that Pete's money was earning before he spent his savings to set up the shoe-shine business

• A)(i) and (ii) only
• B)(iv) only
• C)(iii) and (iv) only
• D)(i), (ii), (iii), and (iv)

---

Definitions:

1756

The year 1756 is notably remembered for the start of the Seven Years' War, a global conflict that involved most of the great powers at the time.

Mercantilism

An economic theory and practice, dominant in Europe from the 16th to the 18th century, that promotes governmental regulation of a nation's economy for the purpose of augmenting state power.

Economic Theory

A set of principles and models that explains how economies operate, including the distribution of resources, the allocation of goods and services, and the consumption behavior of individuals and organizations.