Amanda,aged 6,opens a Lemonade Stand

question 123

Multiple Choice

Amanda,aged 6,opens a lemonade stand.She makes all the lemonade from a mix she found in her parents' pantry.Her stand is an old box she found in the garage.The pitcher and paper cups were taken from the kitchen.Which of the following is true?

• A)The opportunity cost of the lemonade is zero.
• B)The only opportunity cost of the lemonade is Amanda's time.
• C)Amanda's explicit costs are zero.
• D)The implicit costs of Amanda's lemonade are zero.
• E)Whatever revenue Amanda gets will be pure economic profit.

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Definitions:

Robinson-Patman Act

A U.S. antitrust law passed in 1936 to protect against pricing discrimination and predatory pricing to encourage fair competition.

Specific Types

Used to refer to particular categories or varieties within a broader grouping or classification.

Injuries

Physical harm or damage to someone's body caused by an accident or violence.

Rule-Of-Reason Analysis

A legal doctrine used in antitrust law to determine if a restrictive practice is harmful or beneficial to market competition.