Use the Following Scenario to Answer the Following Questions

question 96

Multiple Choice

Use the following scenario to answer the following questions:
Carmela's Churros is a perfectly competitive firm that sells desserts in Houston,Texas.Carmela's Churros currently is taking in $40,000 in revenues,and has $15,000 in explicit costs and $25,000 in implicit costs.
-Carmela's Churros' economic profits are

• A) $40,000.
• B) $15,000.
• C) $25,000.
• D) $0.
• E) $80,000.

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Definitions:

Current Year

The present calendar year in which a transaction or event occurs or is being discussed.

Laspeyres Price Index

An economic measure that calculates the change in the price of a basket of goods and services, using the quantities purchased in the base year as weights.

Per Capita Income

The average income earned per person in a given area or country.

Revealed Preferences

The concept that consumers' choices reveal their preferences and that these choices can be used to infer the utility they derive from different options.