Midterm_BA_315_Winter_05

Midterm_BA_315_Winter_05 - Midterm Exam, Winter 2005 BA...

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1 Midterm Exam, Winter 2005 Student Name:___________ BA 315: Economy, Industry, and Competitive Analysis HW Team#:____________ Department of Finance CRN: Charles H. Lundquist College of Business University of Oregon Ali Emami Answering the following questions please use words, or graphs, or math or any combinations to support your answers. Correct answers without explanations (intuitive, graphical, or mathematical) will not receive any credit. Please limit your answers to the space provided and be very brief in your explanations. 1 .[15 points] During a year of operation, a firm collects $275,000 in revenue (TR) and spends $100,000 on labor expense, $50,000 on raw materials, and a total of $50,000 on both rent, and utilities. The firm’s owner has provided $750,000 of her own money instead of investing the money and earning a 10% annual rate of return. a . [3 points] Calculate the explicit costs of using market-supplied resources: Explicit cost =$_____________., Why (Calculation)? ________________________________ b. [3 points] Calculate the implicit (opportunity) costs of using owner-supplied resources. Implicit Cost =$______________. Why (Calculation)? _______________________________ c. [3 points] Calculate accounting and economic profits. Accounting Profit=$________________. Why? (Calculation) __________________________
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Midterm_BA_315_Winter_05 - Midterm Exam, Winter 2005 BA...

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