Question

Saeed needs money to purchase tools, basic office supplies, parts to refurbish equipment, accounting
software, and legal help fees. Believing Saeed's business will be a success, an investor invests $5,000
to help Saeed open his business. In return, Saeed agrees to repay the investor the $5,000 plus 17
percent of the profits of the business. Calculate the return on investment for the investor if Saeed's
business makes $7,000 in profit as a total return of the business in its first year. Show your work as
part of your answer.​

Answer 1

Answer:

The return of investment for the investor if Saeed's business makes $7000 in profit in its first year is $6190.

Step-by-step explanation:

Saeed agrees to repay the investor the $5000 plus 17 percent of the profits of the business. This can be represented by this equation.

Return of investment for the investor= initial investment+ (percentage of profits X profit)

When we fill in our known numbers, this is the equation. Remember, the profit for the first year was $7000.

Return of investment for the investor = 5000 + (.17 X 7000)

Return of investment for the investor = 5000 + 1190

Return of investment for the investor = $6190

Answer 2

Answer:

The return on investment for the investor is 6190$

Step-by-step explanation:

Given that,

An investor invests an amount of 5000$ believing Saeed's business will be a success.In return saeed agrees to pay the 5000$ and also the 17% of the profit earned to the investor.

Therefore,the amount paid by saeed to the investor is

$5000\ + \frac{17}{100} \times profit \\ = 5000\ + + 0.17(profit)$

Given that,saeed's business makes a profit of 7000$.Substituting the profit amount in above relation,we get

$= > 5000\ +0.17 \times 7000 \\ = 5000\ +1190\ = 6190$

Therefore,The return on investment for the investor is 6190$

#SPJ2