Susan used to work as a telemarketer, earning
$25,000 per year. She gave up that job to start a catering business. In
calculating the economic profit of her catering business, the $25,000 income
that she gave up is counted as part of the catering firm’s
of the above are correct.
Refer to the following information to answer Questions 40
took $500,000 out of the bank and used it to start his new cookie business. The
bank account pays 4 percent interest per year. During the first year of his
business, Zach sold 12,000 boxes of cookies for $3 per box. Also, during the first
year, the cookie business incurred costs that required outlays of money
amounting to $14,000.
40. Zach’s accounting profit for the year was