Rajiv lives in San Diego and runs a business that sells pianos. In an average year, he receives $722,000 from selling pianos. Of this sales revenue, he must pay the manufacturer a wholesale cost of $422,000; he also pays wages and utility bills totaling $268,000. He owns his showroom; if he chooses to rent it out, he will receive $2,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Rajiv does not operate this piano business, he can work as a paralegal, receive an annual salary of $21,000 with no additional monetary costs, and rent out his showroom at the $2,000 per year rate. No other costs are incurred in running this piano business.

1. Identify each of Rajiv's costs in the following table as either an implicit cost or explicit cost of selling pianos.
Implicit Cost Explicit Cost
The rental income Rajiv could receive-
if he chose to rent out his showroom
The salary Rajiv would earn if he-
worked as a financial advisor
The wages and utility bills that Rajiv pays
The wholesale cost for the pianos-
that Rajiv pays the manufacturer

2. Complete the following table by determining Rajiv's accounting and economic profit of his piano business.

Profit (Dollars)
Accounting Profit
Economic Profit