Sam Smith is currently employed as a mechanical engineer and is paid$65,000 per year plus benefits that are equal to 30 percent of his salary. Sam wants to begin a consulting firm and decides to leave his current job.After his first year in business, Sam’s accountant informs him that he hasmade $45,000 with his consulting business. Sam also notices that he paid$6,000 for a health insurance policy, which was his total benefit during hisfirst year. What was Sam’s opportunity cost?
Sam Smith is currently employed as a mechanical engineer and is paid$65,000 per year plus benefits that are equal to 30 percent of his salary. Sam wants to begin a consulting firm and decides to leave his current job.After his first year in business, Sam’s accountant informs him that he hasmade $45,000 with his consulting business. Sam also notices that he paid$6,000 for a health insurance policy, which was his total benefit during hisfirst year. What was Sam’s opportunity cost?
Chapter15: Taxing Business Income
Section: Chapter Questions
Problem 3DQ
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Sam Smith is currently employed as a mechanical engineer and is paid
$65,000 per year plus benefits that are equal to 30 percent of his salary. Sam wants to begin a consulting firm and decides to leave his current job.
After his first year in business, Sam’s accountant informs him that he has
made $45,000 with his consulting business. Sam also notices that he paid
$6,000 for a health insurance policy, which was his total benefit during his
first year. What was Sam’s
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