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) $-\$ 1000$
(B) $\$ 9000$
(C) $-\$ 8020$
(D) $-\$ 2000$
(E) $\$ 8000$

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) $-\$ 1000$
(B) $\$ 9000$
(C) $-\$ 8020$
(D) $-\$ 2000$
(E) $\$ 8000$

Accepted Answer

∻Solution∻ ‖ a ⋮ Calculation of Total Revenue: Total Revenue (TR) is calculated by multiplying the price per unit by the quantity sold. In this case, TR = $80 imes 100. ‖ ‖ b ⋮ Calculation of Economic Profit: Economic Profit is calculated by subtracting Total Cost (TC) from Total Revenue (TR). Economic Profit = TR - TC. ‖ ∻Answer∻ ⚹ -$2000 ⚹ ∻Key Concept∻ ⚹ Economic Profit Calculation ⚹ ∻Explanation∻ ⚹ Economic profit is determined by subtracting the total cost from the total revenue. In this scenario, the total revenue for T-Rex Enterprises is $8000 ($80 per costume times 100 costumes), and the total cost is $9000, resulting in an economic loss of $1000.◊What is the formula for calculating economic profit in macroeconomics?⍭ Generate me a similar question◊⚹

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