A Training Firm Is Planning to Offer a One-Day Class

question 13

Multiple Choice

A training firm is planning to offer a one-day class at a local facility. The class is projected to have 50 students, each of whom will pay $25.00 to attend. The firm provides materials to each student (materials cost the firm $10.00 per student) . What is the most the firm can afford to pay to rent the facility for one day?

• A) $250.
• B) $500.
• C) $750.
• D) $1,000.
• E) $1,250.

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Definitions:

Accounting Profit

The difference between the total revenue received from sales and the total explicit costs of a business.

Explicit Costs

Direct payments made to others in the course of running a business, such as wages, rent, and materials.

Implicit Costs

The opportunity costs of using resources that a business already owns, representing the potential income lost in employing them in a specific task.

Forgone Income

Income not earned due to choosing an alternative action, such as studying full-time instead of working.