Assume Brad worked as a contractor for a year and had revenues of $120,000 and explicit cost of $70,000.If he could have been paid $80,000 working for a computer company, his:

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To calculate Brad's accounting profit, we subtract explicit costs from revenues. Therefore, his accounting profit would be $120,000 - $70,000 = $50,000. However, to calculate his economic profit, we need to take into account his opportunity cost. In this case, his opportunity cost is the $80,000 he could have made working for a computer company. Therefore, his economic profit would be $120,000 - $70,000 - $80,000 = -$30,000. This means that he would have been better off financially if he had taken the job with the computer company, so it would be rational for him to stop working as a contractor.

Assume Brad Worked as a Contractor for a Year and Had