Profit - 707 Words
1.
a. The total explicit cost is $793,000($970,000-$177,000). The total implicit cost is $190,000($175,000+.15X$100,000). The total economic costs is $983,000($793,000+$190,000).
b. The accounting profit in 2010 is $177,000($970,000-$793,000)
c. The economic profit in 2010 is $-13,000($970,000-$793,000-$190,000).
d. The owner should not leave his job because the economic profit is negative, which means he will earn less if he does his own business.
2.
a. The type of agency problem that is...
707 Words | 3 Pages