Problems-

1. Suppose that Bob leaves a job that pays $50,000 per year in order to open a new sponge business. His insurance cost is $5,000, his material cost is $25,000, his lease payments are $10,000 and his sales revenue is $90,000. Bob's economic profit is:

A) $0.

B) $40,000.

C) $50,000.

D) $90,000.

2. Using information from the figure, if price equals $0.70, the firm should:

A) stay open because it is making an economic profit.

B) stay open in the short run, although it will earn negative profits.

C) stay open because it is making a normal profit.

D) shut down.

Additional Information-

These multiple choice questions related to Economics. The both problems are about finding out economic profit.