Joe runs a small boat factory. He can make ten boats per year and sell them for
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Question:
a. What is the total revenue Joe can earn in a year?
b. What are the explicit costs Joe incurs while producing ten boats?
c. What are the total opportunity costs of producing ten boats (explicit and implicit)?
d. What is the value of Joe's accounting profit?
e. What is the value of Joe's economic profit?
f. Is it truly profitable for Joe to operate his boat factory? Explain.
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