Suppose juliana owns a small business making handbags. each month she makes 18 handbags, which she sells for $100 each. the materials used to make each handbag cost $50. in addition, juliana uses a spare room in her house to make the handbags and store her supplies. if she were not using the spare room for her business, she would use it as a guest room, an option that juliana would value at $250 per month. if juliana weren’t making handbags, she would work at trader joe’s earning $800 per month. what is juliana’s economic profit each month?

$-150

Explanation:

Sales Revenue = 18 handbags per month X $100 per handbag

                         =  $1,800

Variable costs = 18 handbags X $50 cost per handbag

                        = $900

Juliana's Net Income = $1,800 - $900

                                   = $900

Juliana's opportunity costs = $250 for renting guest room + $800 at job

                                             = $1050

Juliana's Economic Profit = Net Income - Total Opportunity Costs

                                        = $900 - $1,050

                                        = -$150

Hence, her economic profit is actually a negative 150 dollars.

answer; i believe the correct answer is (sales promotion;

answer; operating revenues;