Question

Suppose Lando Calrissian owns a smuggling business whose total revenue is 30,000 per month. The accompanying table shows Lando's monthly expenses. If Lando weren't a smuggler, he would earn 6,000 per month working for the Rebel Alliance. Apart from pay, Lando is indifferent between working as a smuggler and working for the Rebel Alliance. What is Lando's net monthly income as a smuggler?

1) 24,000
2) 18,000
3) 12,000
4) 6,000

Answer 1

Lando's net monthly income as a smuggler is $12,000.

Step-by-step explanation:

To calculate Lando's net monthly income as a smuggler, we need to subtract his monthly expenses from his total revenue. Lando's monthly expenses are as follows:

• Labor cost: $6000
• Equipment cost: $4000
• Operating cost: $5000
• Maintenance cost: $3000

Adding up all the expenses gives us a total of $18,000 per month. To calculate Lando's net monthly income, we subtract the total expenses from the total revenue: $30,000 - $18,000 = $12,000. Therefore, Lando's net monthly income as a smuggler is $12,000. The correct answer is option 3).