Scenario 13-8 Wanda Owns a Lemonade Stand. She Produces Lemonade Using Five

question 77

Multiple Choice

Scenario 13-8
Wanda owns a lemonade stand. She produces lemonade using five inputs: water, sugar, lemons, paper cups, and labor. Her costs per glass are as follows: $0.01 for water, $0.02 for sugar, $0.03 for lemons, $0.02 for cups, and $0.10 for the opportunity cost of her labor. She can sell 300 glasses for $0.50 each.
-Refer to Scenario 13-8. What are Wanda's total economic profits?

• A)$150
• B)$126
• C)$96
• D)$54

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Definitions:

Parol Evidence Rule

A legal principle that prevents parties to a written contract from presenting extrinsic evidence of terms that contradict or modify the written terms of the contract.

Obligor

A person or entity legally bound to provide a benefit or payment to another under the terms of a contract.

Statute of Frauds

A rule of law stipulating that specific kinds of agreements must be documented and signed in order to be legally binding.

Uniform Commercial Code

A compilation of legal regulations and guidelines that dictate the conduct of business transactions and operations in the United States.