Suppose Billy owns a hair salon in Collingwood. He has one large hair dryer for which he paid $1,000. If he can sell the dryer one year later for $800, his total economic depreciation equals

Question

Quizplus · Accepted Answer

Economic depreciation is the decrease in the value of an asset over time due to wear and tear, obsolescence, or other factors. In this case, Billy's economic depreciation equals the difference between the purchase price and the resale value, which is $1,000 - $800 = $200. Therefore, the correct answer is B.

Suppose Billy Owns a Hair Salon in Collingwood