Korey is planning to open a comic book store. In his first year of operation, Korey expects to average $1,000 of profit each month. He then expects profits to increase by 6% each year for the next 4 years. How much does Korey expect to make in profits in his fifth year of operation? A = P (1 + r) superscript t
a. $15,149.72
b. $16,058.71
c. $31,120.46
d. $32,987.69
a. $15,149.72
b. $16,058.71
c. $31,120.46
d. $32,987.69
Answers & Comments
Verified answer
Answer:
this exercise we have to use the knowledge of finance to calculate the profits that Korey expect to make is $15,149.72.
Answer:
a
Explanation:
First year profit: $1000*12 = $12,000
Second year profit: $12,000 * 1.06
Third year profit: $12,000 * 1.06^2
Fourth year profit: $12,000 * 1.06^3
Fith year profit: $12,000 * 1.06^4 =$15,149.72