Question

You are considering a gradual expansion of your restaurant's square footage. Three tables per year will increase your profits by 4% per year. Your current yearly profit is $135,000. What will your annual profit be after 5 years?

a) $138,909
b) $155,344
c) $164,248
d) $188,125

Answer 1

C) $164,248

Step-by-step explanation:

None, I did the quiz and that was the answer

Answer 2

Annual profit after 5 year = $164,248 (Approx)

Step-by-step explanation:

Given:

Current year profit P = $135,000

Growth g = 4 % = 0.04

Number of year n = 5 year

Find:

Annual profit after 5 year

Computation:

Annual profit after 5 year = P(1+g)ⁿ

Annual profit after 5 year = 135,000(1+0.04)⁵

Annual profit after 5 year = $164,248 (Approx)