Question

Jane grows apples on land she inherited from her grandmother. She incurs explicit costs of $200 for the trees and $60 for fertilizers. In​ addition, suppose her land is otherwise worth $9,000 and her labor is worth

​$20,000 ​(this is the amount she could earn managing someone​else's land instead of her​ own). The market price of apples is $36 per box. If at this price Jane produces 1,500 boxes of apple then her economic profit is

Answer 1

Answer:

Economic profit= $24,740

Explanation:

Giving the following information:

Jane grows apples on land she inherited from her grandmother. She incurs explicit costs of $200 for the trees and $60 for fertilizers.  The market price of apples is $36 per box. At this price, Jane produces 1,500 boxes of apple.

Suppose her land is worth $9,000 and her labor is worth

​$20,000.

Sales= 54,000

Fixed costs= 260

Opportunity cost= 29,000

Economic profit= $24,740