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Carri has started an economic consulting firm She invested $50000 of her own funds in furniture computers and other

Carri has started an economic consulting firm. She invested $50,000 of her own funds in furniture, computers, and other equipment. During the first year of operation, the firm’s costs were $40,000 for rent on the office building, $150,000 for wages and salaries of employees, and $15,000 for supplies and utilities. The market value of the firm’s assets at the end of the year was $35,000. To start her firm, Carri had to quit her job at another firm where she earned $80,000 per year. The typical rate of return on financial investments in the economy is 4%. During the first year of operation, the firm billed its clients for 2,500 hours at $140 per hour. What is Carri's economic profit? $___

Apr 21 2020 View more View Less

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