Bill is an economics professor who earns $40,000 teaching but decides to leave and fulfill his dream of catering barbecues.During his first year of barbecuing he earned total revenue of $60,000.He spent $30,000 on food and supplies.He also paid his wife $10,000 to help serve food.The normal profit for an entrepreneur running a barbecue business is $3,000.He also rented an industrial grill/fry truck for $12,000.An accountant would conclude that Bill's profit was

Question

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Bill's revenue was $60,000, his expenses were $30,000+$10,000+$12,000=$52,000. Therefore, his profit is $60,000-$52,000=$8,000. This is less than the normal profit of $3,000 for an entrepreneur running a barbecue business, but it is still a positive profit.

Bill Is an Economics Professor Who Earns $40,000 Teaching but Decides