A company makes a revenue of $200,000. The explicit costs of the company are $120,000. The owner has investment $70,000 into the business while there is an opportunity to earn 10% with a mutual fund. The owner also denied a $150,000 salary offer that came from a reputable company. Find both accounting and economic profit.
Accounting profit = revenue-explicit costs= 200,000-120,000=$80,000
View Full Answer