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(b) Ashley is a fresh graduate and is now planning to start a new business. She would run an online shop to sell snacks imported
(b) Ashley is a fresh graduate and is now planning to start a new business. She would run an online shop to sell snacks imported from Japan. She expects the annual purchase cost would be $380,000 and the annual sales would be $790,000. Four sets of computers are needed, which cost $7,000 each and could be sold at half price in the second-hand market after one year. She has to rent a small office, which costs her $19,000 per month. (i) Calculate the annual accounting profit of Ashely's snack business. (4 marks) (ii) Ashley will be involved in the daily operations of this snack business and has to give up the opportunity to get a full-time job. In consideration of annual economic profit, in what condition should Ashley start this business? Explain with relevant figures. (4 marks)
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