Question V:

Suppose Firmino currently makes $50,000 per year working as a manager at a cable TV

company. He then develops two possible entrepreneurial business opportunities. In one, he

will quit his job to start an organic soap company. In the other, he will try to develop an

internet-based- competitor to the local cable company. For the soap-making opportunity, he

anticipates annual revenue of $465,000 and costs for necessary land, labor, and capital of

$395,000 per year. For the internet opportunity, he anticipates costs for land, labor, and

capital of $3,275,000 per year as compared to revenues of $3,275,000 per year.

a. Should he quit her current job to become an entrepreneur

b. If he does quit his current job, which opportunity would he peruse?