Harvey Develops Gaming Apps from Home Instead of Working as an Engineer

question 27

Multiple Choice

Harvey develops gaming apps from home instead of working as an engineer and earning $50,000 a year.He has invested $20,000 to upgrade to the hardware that he needs and estimates his expenses at $17,000 a year.If downloads generate $50,000 in revenue during the first year,then his business _____

• A)has an accounting profit but an economic loss.
• B)has an accounting loss and an economic profit.
• C)has both accounting and economic profits.
• D)has both an accounting and an economic loss.
• E)has a normal profit.

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Definitions:

Two-step Communication

A theory in communication where information flows from the media to opinion leaders and then to a wider audience.

Social Networking Sites

Online platforms that enable users to create personal profiles and connect with friends and family, share content, and establish social and professional networks.

Rate of Diffusion

The speed at which a new product, service, or innovation spreads across a market or society.

Highly Complex Innovations

Innovations that are sophisticated and involve a high degree of technical advancement or complex combinations of technologies and processes.