Scenario 9.1 Jane Left Her Job at Siemens and Started Her Own

question 3

Multiple Choice

Scenario 9.1
Jane left her job at Siemens and started her own boutique. She used to earn $50,000 annually at Siemens. She took a loan of $10,000 and used $20,000 from her personal savings to begin her venture. She agreed to repay the loan with 10% interest. Her business is bringing in $80,000 annually. She has rent and labor expenses of $15,000. Also assume that Jane could have used her own money i.e. $20,000 to buy stocks in Intel which would have returned 5% to her last year.
-Refer to Scenario 8.1. Compute Jane's economic profit.

• A)$13,000
• B)$14,000
• C)$20,000
• D)$15,000
• E)$10,000

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Definitions:

Marginal Utility

The added satisfaction a consumer gets from having one more unit of a good or service.

Demand Schedule

A table that lists the quantity of a good or service demanded by consumers at various price levels.

Marginal Utility Data

Information that quantifies the added satisfaction a consumer gains from consuming one more unit of a good or service.

Prices

The amount of money required to purchase goods or services, set by supply and demand in a market.