Barney decides to quit his job as a corporate accountant, which pays $12,000 a month, and goes
Question:
Barney decides to quit his job as a corporate accountant, which pays $12,000 a month, and goes into business for himself as a certified public accountant.
He runs his business from his converted garage apartment, which he could rent out for $325 a month if he wasn’t using it as a home office. He must purchase office supplies worth $80 a month, and his monthly electricity bill has increased by $60 now that he is working out of his home office.
After six months of working from home, Barney has earned an average of $15,000 per month.
Instructions: Enter your answers as a whole number.
a. What are Barney’s monthly explicit costs?
b. What are Barney’s monthly implicit costs?
c. What are Barney’s monthly economic costs?
Principles of Macroeconomics
ISBN: 978-0134078809
12th edition
Authors: Karl E. Case, Ray C. Fair, Sharon E. Oster