Tom borrowed PHP500,000 from her parents to open a spa. He pays her parents a 5% yearly return on the money they lent her. Her other yearly fixed costsequal PHP150,000 and his variable costs equal PhP200,000. In her first year, Tom had a total of 2,000 customers at a price of PHP300/customer. Tom's totaleconomic profit is

Borrowed amount = Php500,000 yearly return on money = 5% Fixed cost per year = Php150,000 Variable…

Answered: Tom borrowed PHP500,000 from her…

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 3.4CE

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