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Question
Corrina was working as a waitress in an Italian restaurant making an annual income of $25,000 per year when she decided to start up her own catering business. Corrina used $10,000 of her savings that was earning 5 percent annual interest to establish her business. After the first year she made an accounting profit of $20,000. Her economic profit was
A) -$5,550.
B) -$5,000.
C) $20,000.
D) $25,000.
Answer
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