Use the Following to Answer Questions

question 71

Multiple Choice

Use the following to answer questions :
Scenario: Accounting and Economic Profit
Rather than put the $100 000 that his grandmother left him in a mutual fund that earns 5% each year,Tommy Wang quit his job,which paid $60 000 per year,and started Wang's Wicker Furniture Store.He rented a showroom for $20 000 for the year,purchased $60 000 in wicker furniture,and incurred costs of $40 000 for sales help and advertising.In his first year,his revenue was $150 000.
-(Scenario: Accounting and Economic Profit) Use Scenario: Accounting and Economic Profit.The implicit cost of capital for Wang's Wicker Furniture Store is:

• A) $0.
• B) $2 000.
• C) $5 000.
• D) $50 000.

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Definitions:

Bargaining Process

The negotiation between parties, such as unions and employers, to reach agreement on terms of employment.

Good Faith

The honest intent to act without taking an unfair advantage over another party, often required in contractual agreements.

Collective Agreement

A written contract negotiated through collective bargaining for labor between an employer and a union representing the employees.

Legal Bargaining Agent

A representative, often a union, designated to negotiate employment terms on behalf of a group of employees.