View the step-by-step solution to:

Chris was the business manager for a real estate firm earning an annual salary of $45,000. Then Chris decided to become a consultant.

Chris was the business manager for a real estate firm earning an annual salary of $45,000. Then Chris decided to become a consultant. Chris hired an administrative assistant at $20,000 per year and rents office space (utilities included) for $3,000 per month. Chris earned $150,000 in total revenue the first year.

Q1 chris's economic profit is?

Q2 chris's normal profit?

Top Answer

The explanation below shows how to... View the full answer

4 comments
  • that's was my answer for the normal profit but unfortunately $94000 is not one of the answers the only available answers are: $15000/$20,000/$36000/$45,000
    • abdullahti656
    • May 09, 2018 at 1:38am
  • But that is how normal profits are calculated. what about the answer for economic profits?
    • celestinengetich
    • May 09, 2018 at 1:41am
  • yeah i know, that's why it confused me. and it's true for the economic profits
    • abdullahti656
    • May 09, 2018 at 1:45am
  • I have read somewhere that normal profits equal thecost of production implying that it is zero. In this case, normal profits equal the opportunity cost hence it is $4500
    • celestinengetich
    • May 09, 2018 at 1:46am

Sign up to view the full answer

Other Answers

Economic profit : 82,000$ Accounting profit : 1,27,000 Economic profit... View the full answer

Economic profit = total revenue - (explicit cost +... View the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online