Barney decides to quit his job as a corporate accountant, which pays $10,000 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 $300 a month if he wasn’t using it as a home office. he must purchase office supplies worth $75 a month, and his monthly electricity bill has increased by $50 now that he is working out of his home office. after six months of working from home, barney has earned an average of $12,000 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?

A- $ 50  Electricity

     $ 75   Office suplies

     $ 125Total explicit costs

B-  $ 300   Rent

$10000 Lost of salary for quitting his job

      $ 10300  Total implicit cost

C-  $ 125    Total explicit costs

     $ 10300   Total implicit cost

     $ 10425   Total economic cost

Explanation:

A- Explicit costs are observable (such as salaries paid to  employees, material costs, taxes, etc.) and are paid with cash.

B- Implicit costs are those incurred for giving up an alternative use of a specific resource, but no cash outlay is made. In this case, $ 300 that is no longer earned by using the garage as an office and $10000 lost each month for quitting his job.

C- The sum of the implicit and explicit costs determines the total economic cost

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options ?

explanation: