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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Barney decides to quit his job as a corporate accountant, which pays $12,000 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 $85 a month, and his monthly electricity bill has increased by $40 now that he is working out of his home office.
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Chapter 14 Solutions
Foundations of Economics (8th Edition)
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