Erin's accounting costs were $_____ Her cost of capital was $____ Her total costs were $ ___ Her economic profit was ____ And her normal profit was $ ____
Erin quit her job, where she earned $90,000 per year, to start her own economic consulting firm. She invested $60,000 of her own funds in furniture, computers, and other assets. During the first year of operation, the firm’s costs were $50,000 for rent on the office building, $300,000 for wages and salaries of employees, and $10,000 for supplies and utilities. The market value of the firm’s assets at the end of the year was $48,000. During the year, the firm billed its clients for 2,400 hours at $200 per hour. The typical rate of
Erin's accounting costs were $_____
Her cost of capital was $____
Her total costs were $ ___
Her economic profit was ____
And her normal profit was $ ____
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