Question

Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce.


Refer to Scenario 13-3. Ziva's economic profit from farming equals _______.

Answer 1

Answer:

Economic profit= -$80

Explanation:

Giving the following information:

Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce.

The economic profit includes the opportunity cost of not working as a home-organization.

Economic profit= (300 - 130) - 25*10

Economic profit= -80