?

AP® Microeconomics

Free Version

Upgrade subject to access all content

Moderate

Donnell's Health Food Store

APMICR-F1SVEF

Donnell opened his own health food store last year. In his first year of operation, he earned \$250,000 in revenue. In order to open and maintain the shop, Donnell had to quit the job he held that paid him \$50,000 a year, and he had to sell the two-story house that he owned, in which he rented out the basement to a tenant for \$1,000 a month.

The explicit costs of production for Donnell’s store were \$70,000, so this means:

A

Donnell earned \$180,000 in accounting profit and \$100,000 in economic profit

B

Donnell earned $200,000 in accounting profit and 199,000 in economic profit

C

Donnell earned $130,000 in accounting profit and 188,000 in economic profit

D

Donnell earned $180,000 in accounting profit and 118,000 in economic profit

E

Donnell earned $130,000 in accounting profit and 110,000 in economic profit