Adam Weed Is the Owner/operator of a Flower Shop

question 87

Multiple Choice

Adam Weed is the owner/operator of a flower shop.Last year he earned $250,000 in total revenue.His explicit costs were $175,000 paid to his employees and suppliers (assume that this amount represents the total opportunity cost of these resources) .During the year he received three offers to work for other flower shops with the highest offer being $75,000 per year.Which of the following is true about Adam's accounting and economic profit?

• A) Accounting profit = $75,000; economic profit = $0.
• B) Accounting profit = $175,000; economic profit = $75,000.
• C) Accounting profit = $75,000; economic profit = negative $100,000.
• D) Accounting profit = $0; economic profit = negative $75,000.

---

Definitions:

Variance

A measure of dispersion in a set of data points, calculated by taking the average of the squared differences from the mean.

Standard Deviation

A statistic that quantifies the dispersion or variability of a dataset, measuring the average distance between each data point and the mean.

Z-score

A quantitative measure that demonstrates the correlation of a specific value to the mean of a dataset, identifying its separation from the mean by counting the standard deviations.

Standard Normal Random Variable

A type of random variable that has a mean of 0 and a standard deviation of 1, following the standard normal distribution.