What are Barney’s average monthly accounting profits?        $     b. What are Barney’s average monthly economic profits?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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Barney decides to quit his job as a corporate accountant, which pays $15,000 a month, and goes into business for himself as a certified public accountant. 

He runs his business from his converted garage apartment, which he could rent out for $315 a month if he wasn’t using it as a home office. He must purchase office supplies worth $60 a month, and his monthly electricity bill has increased by $40 now that he is working out of his home office. 

After six months of working from home, Barney has earned an average of $17,000 per month.

 

Instructions: Enter your answers as a whole number.

 

a. What are Barney’s average monthly accounting profits?

 

     $  

 

b. What are Barney’s average monthly economic profits?

 

     $  

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