Question

A slushy representative convinces you to lease a machine for $200 per month. You discover that you are selling $900 per month of slushies at a margin of 30%. Are you making money on the machine?

Answer 1

Yes, you are making a profit.

Explanation:

Let x represent the number of months. Leasing a machine at $200 per month would give us the expression -200x (negative since we pay the money).

We sell $900 per month of slushies, and our profit margin is 30%. This means we make 30% profit on the slushies; this gives us the expression 0.3(900x).

Adding these together, we have

-200x+0.3(900x) = -200x+270x = 70x

We earn $70 per month on the machine.