Bob owns a chicken farm / meat processing plant.

Bob can buy a live chicken for $250. If Bob wants to sell one of his live chickens, he must pay a livestock tax and receives only $180 dollars from the sale. Bob can sell a processed whole chicken (turned into food avoiding the tax) to a grocery store for $300.

The question is : How much profit does Bob makes from the processing of his chickens? Does his processing give him a profit of $50 per chicken or $120 per chicken?

$50

$50

this isn't an economics question but a comprehension question...

Basically all you want is the net difference between his cost ( 250 ) and his sale price.

As the question pertains to processing, you look for the sale price of the processed chicken ( $300 ) , and ignore the "live chicken" sale price ( $180 )

Net difference is plus $50

$50 minus the cost of buying and processing the chicken if he buys one
since the cost of raising a chicken is not specified it is impossible to work out the profit he makes in that case

guess $50 is the answer wanted but the question is poorly formulated