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question 159

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Use the following to answer questions:
Scenario: Betty's Cookie Shop
Betty runs a cookie shop where she sells cookies for $1 each. She employs five people, each of whom worked a total of 500 hours last year; she paid them $10 per hour. Her costs of equipment and raw materials add up to $75,000. Her business ability is legendary, and other companies have offered to pay Betty $100,000 to come to work for them. She also knows she could sell her cookie shop for $150,000. The bank in town pays an annual interest rate of 3% on all funds deposited with it.
-(Scenario: Betty's Cookie Shop) Betty's implicit and explicit costs are equal to:


Definitions:

F-test

is a statistical test used to compare the variances of two populations, based on sample variances, to assess the equality of the populations' means.

Hypothesis

A proposed explanation or prediction about a phenomenon that can be tested through research and experimentation.

Sales Dollars

The total revenue generated from sales, expressed in dollars.

One-tailed T-test

A statistical test used to determine if a sample mean significantly exceeds or is significantly less than a hypothesized value.

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