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Q. In 2012, Balnur taught music and earned $20,000. She also earned $4,000 by renting out her basement. On January 1, 2013, she quit teaching, stopped renting out her basement, and began to use it as the office for her new Web site design business. She took $2,000 from her savings account to buy a computer. During 2013, she paid $1,500 for the lease of a Web server and $1,750 for high-speed Internet service. She received total revenue from Web site designing of $45,000 and earned interest at 5 percent a year on her savings account balance. Normal profit is $55,000 a year. At the end of 2013, Balnur could have sold her computer for $500. Calculate Balnur's opportunity cost of production and economic profit in 2013.
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