Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 14, Problem 2IAPA
To determine
Sonya's previous income = $25,000 a year
Return of other entrepreneurs in greeting card industry = $14,000 a year
Sonya's cost of cards = $10,000 from manufacturers
Sonya's revenue = $58,000
Rental cost = $5,000
Cost of utilities = $1,000
Cost of cash register purchased from savings account = $2000
Savings account interest rate = 3%
Sonya was offered $1,600 for her cash register at the end of the year.
Determine explicit costs, implicit costs and economic profit for the year.
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