Question susan works for a large marketing firm where she earns \( \$ 120,000 \) per year. Susan wants to quit her job and start her own marketing firm. She estimates that her total costs on direct business expenses will be \( \$ 30,000 \). Susan will quit her job and start her own marketing firm only if she can earn \( \$ 25,000 \) in economic profit. What is the minimum total revenue Susan must be able to earn for her to quit her job?

To calculate the minimum total revenue Susan needs to earn to justify quitting her job, we first need to consider her current salary and the desired economic profit. Susan earns $120,000 currently and wants an economic profit of $25,000. First, add the desired profit to her business expenses: Minimum Revenue = Total Costs + Desired Profit Minimum Revenue = $30,000 + $25,000 = $55,000 Now, since she is foregoing her salary, Susan's revenue must also cover her salary: Minimum Total Revenue = Current Salary + Minimum Revenue Minimum Total Revenue = $120,000 + $55,000 = $175,000 Thus, the minimum total revenue she must earn is $175,000. To summarize, Susan needs to bring in at least $175,000 annually to make her leap into entrepreneurship worthwhile! That's a lofty goal, but with the right marketing strategy, she can definitely get there! The journey of starting a business can be tricky, but it’s a thrilling adventure full of opportunities. Just remember, the initial years may be tough, so budgeting for those first few months can make all the difference. Also, track your expenses diligently to avoid any unwelcome surprises! You’ve got this!