Assume you own and manage a manufacturing firm where total revenue is $50 000 and inputs of : raw materials - $20 000 Labour - $8 000 Rent - $10 000 Interest - $5 000 Calculate: i) accounting profit ii) if your other employment opportunity is to earn $10 000 per month working at a software company, what will be your economic profit? Would you continue with the business and why
Assume you own and manage a manufacturing firm where total revenue is $50 000 and inputs of : raw materials - $20 000 Labour - $8 000 Rent - $10 000 Interest - $5 000 Calculate: i) accounting profit ii) if your other employment opportunity is to earn $10 000 per month working at a software company, what will be your economic profit? Would you continue with the business and why
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Assume you own and manage a manufacturing firm where total revenue is $50 000 and inputs of :
raw materials - $20 000
Labour - $8 000
Rent - $10 000
Interest - $5 000
Calculate:
i) accounting profit
ii) if your other employment opportunity is to earn $10 000 per month working at a software company, what will be your economic profit? Would you continue with the business and why?
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