Refer to the table below. The table shows the monthly economic profit of a drugstore. If the owner of the drugstore hired a manager for $12 an hour to take his place, how much of a change would show up in profits?

Mathematics · College · Thu Feb 04 2021

Answered on

Generally, to calculate the change in profits due to hiring a manager at $12 an hour, you would perform the following steps:

1. Calculate the total manager's cost per month: Multiply the number of hours the manager will work each month by their hourly wage ($12).

Manager's monthly cost = Number of hours worked per month x $12

2. Determine the economic profit change: Subtract the manager's monthly cost from the current monthly economic profit of the drugstore.

Change in profits = Current Monthly Profit - Manager's monthly cost

Remember that economic profit considers both explicit costs (like the wage you would pay the manager) and implicit costs (like the opportunity cost of the owner's time). If hiring a manager allows the owner to reallocate time to other productive activities that generate additional income, that would also impact economic profit.

However, since the table with the drugstore's monthly economic profit wasn't provided, I can't complete these calculations for you. If you provide the necessary details, I would be happy to walk through the exact calculations.