Philip Owns and Operates a Gas Station

question 13

Multiple Choice

Philip owns and operates a gas station.Philip works 40 hours a week managing the station but doesn't draw a salary.He could earn $600 a week doing the same work for Terrance.The station owes the bank $100,000 and Philip has invested $100,000 of his own money.If Philip's accounting profits are $1,000 per week while the interest on his bank debt is $500 per week, the business's economic profits are

• A)$500 per week.
• B)-$100 per week.
• C)$400 per week.
• D)$0 per week.
• E)$1,000 per week.

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