T-Rex Enterprises produces and sells dinosaur costumes in a competitive market. The total cost of producing 100 dinosaur costumes is $\$ 9000$. The price of a dinosaur costume is $\$ 80$.

What is this firm's economic profit (or loss)?

Choose 1 answer:
(A) $\$ 8000$
(B) $-\$ 2000$
(C) $-\$ 8020$
(D) $\$ 9000$
(E) $-\$ 1000$

Question

T-Rex Enterprises produces and sells dinosaur costumes in a competitive market. The total cost of producing 100 dinosaur costumes is $\$ 9000$. The price of a dinosaur costume is $\$ 80$.

What is this firm's economic profit (or loss)?

Choose 1 answer:
(A) $\$ 8000$
(B) $-\$ 2000$
(C) $-\$ 8020$
(D) $\$ 9000$
(E) $-\$ 1000$

Accepted Answer

***B*** ∻Key Concept∻ ⚹Economic Profit⚹ ∻Explanation∻ ⚹Economic profit is calculated as total revenue minus total cost. In this scenario, the total revenue from selling 100 dinosaur costumes at $80 each is $8000. The total cost is $9000. Therefore, the economic profit is $8000 - $9000 = -$2000, indicating a loss.⚹◊What is the formula for calculating economic profit in MicroEconomics⍭ Generate me a similar question◊

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