A photocopy shop can produce its daily output of 10,000 copies with either of two processes

A photocopy shop can produce its daily output of 10,000 copies with either of two processes. Process A uses 4 workers and 8 photocopy machines. Process B uses 5 workers and 5 photocopy machines.

a. If each worker's daily wage is $90, and the daily rental (as well as wear and tear) of a photocopy machine is $50, the shop's owner will choose Process  

(select)

B

A

  , because with Process A total daily costs of employing capital and labour are $  and with Process B they are $  .

b. Besides the costs of labour and capital, the owner daily pays $30 in building rent and $10 in business taxes.

   The shop's daily explicit costs are therefore $  .

c. If the shop's price per photocopy is $0.10 (i.e. 10 cents), the daily accounting profit is $  .

d. The owner estimates that she could earn $160 a day if she managed another shop instead of her own shop and the $200,000 she invested in her business could earn $30 a day if she put it into her friend's business venture.

   The shop's daily implicit costs are $.

   The shop's daily economic costs are $.

e. The shop's daily economic profit is $.

f. The owner  

( select)

should

should not

  consider closing down her business because the shop is making a  

( select)

zero

positive

negative

  economic profit.