Question
Andrew operates a small shop specializing in party favors. He owns the building and supplies all his own labor and money capital. Thus, Andrew incurs
Andrew operates a small shop specializing in party favors. He owns the building and supplies all his own labor and money capital. Thus, Andrew incurs no explicit rental or wage costs. Before starting his own business Andrew earned $1,000 per month by renting out the store and earned $2,500 per month as a store manager for a large department store chain. Because Andrew uses his own money capital, he also sacriced $1,000 per month in interest earned on U.S. Treasury bonds. Andrew's monthly revenues from operating his shop are $10,000 and his total monthly expenses for labor and supplies amounted to $6,000. Calculate Andrew's monthly accounting and economic prots.
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