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Korey’s comic book store has been up and running for 4 years. korey feels that his store has been successful and is considering moving to a larger property to allow for greater inventory and customer opportunities in his business. he would like investors to cover the cost of his expansion. the profits of korey’s comic book store for its first four years are outlined below. according to this information, what would be the best estimate for korey to quote as expected profits in the next year in his new business plan? year net profits 1 $14,250.00 2 $15,390.00 3 $16,621.20 4 $17,950.90 5 a. $20,550.19 b. $19,090.90 c. $19,280.60 d. $19,386.97 please select the best answer from the choices provided a b c d

Respuesta :

Based on his net income growth rate over the past 4 years, Korey's comic book store can quote expected profits of $19,386.97.

What is the expected profit?

The expected profit is the probability of getting a profit on a certain amount.

First, we need to find the rate of growth for his income

= (4th year income - 3rd year income) / 3rd-year income

= (17,950.90 - 16,621.20) / 16,621.20

= 8%

The expected income

= 4th year income x ( 1 + growth rate)

= 17,950 x ( 1 + 8%)

= $19,386.97.

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