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2. Calculating costs Susan is working for a consulting firm making $60,000 per year but considers starting her own consulting company. Susan has determined that to launch the business, she needs to invest $100,000 of her own funds. The annual cost of running the business will include $75,000 for the rent of the office space, $190,000 for employee wages, and $6,000 for materials and utilities. Susan plans to manage the business, which means that she will have to quit her current job. Suppose that the interest rate (or rate of return) on investments in the economy is 6%. Susan's total explicit cost per year is Susan's total cost per year is

2. Calculating costs Susan is working for a consulting firm making $60,000 per year but considers starting her own consulting company. Susan has determined that to launch the business, she needs to invest $100,000 of her own funds. The annual cost of running the business will include $75,000 for the rent of the office space, $190,000 for employee wages, and $6,000 for materials and utilities. Susan plans to manage the business, which means that she will have to quit her current job. Suppose that the interest rate (or rate of return) on investments in the economy is 6%. Susan's total explicit cost per year is Susan's total cost per year is

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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2. Calculating costs Susan is working for a consulting firm making $60,000 per year but considers starting her own consulting company. Susan has determined that to launch the business, she needs to invest $100,000 of her own funds. The annual cost of running the business will include $75,000 for the rent of the office space, $190,000 for employee wages, and $6,000 for materials and utilities. Susan plans to manage the business, which means that she will have to quit her current job. Suppose that the interest rate (or rate of return) on investments in the economy is 5%. Susan's total explicit cost per year is Susan's total cost per year is I
Transcribed Image Text:2. Calculating costs Susan is working for a consulting firm making $60,000 per year but considers starting her own consulting company. Susan has determined that to launch the business, she needs to invest $100,000 of her own funds. The annual cost of running the business will include $75,000 for the rent of the office space, $190,000 for employee wages, and $6,000 for materials and utilities. Susan plans to manage the business, which means that she will have to quit her current job. Suppose that the interest rate (or rate of return) on investments in the economy is 5%. Susan's total explicit cost per year is Susan's total cost per year is I
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