Comparison of Accounting & Economic Profits
Peggy-Sue's cookies are the best in the world, or so I hear. She has been offered a job by Cookie Monster, Inc., to come work for them at $125,000 per year. Currently she is producing her own cookies, and she has revenues of $245,000 per year. Her costs are $40,000 for labor, $10,000 for rent, $35,000 for ingredients, and $5