Question

Tony could earn $90,000 per year teaching economics. He estimates that his capital investment in the business is $50,000. He financed this investment with credit card debt that charges an interest rate of 12% per year. Tony's economic profit is $_____. Enter your answer as an integer without a $ sign, comma, or decimal point. Please type the correct answer in the following input field, and then select the submit answer button or press the enter key when finished. Your answer:

Answer 1

Answer:

Economic Profit is $79,200

Explanation:

Tony income per year =         $ 90,000

Interest Expense per year      $(10,800)  {90,000*12%}

Economic Profit per year is    $ 79,200