Question

suppose a firm manager has a base salary of $75,000 and earns 1.5 percent of all profits. determine the manager's income, if revenues are $10,000,000 and profits are $5,000,000.

Answer 1

The firm manager's total income is $150,000, which includes their base salary of $75,000 and an additional $75,000 from 1.5 percent of a $5,000,000 profit.

Step-by-step explanation:

If a firm manager has a base salary of $75,000 and earns 1.5 percent of all profits, we can determine their total income by first calculating the income from their percentage of the profits and then adding that amount to their base salary. Given that the profits are $5,000,000, the manager's income from the profit percentage is 1.5% of $5,000,000, which is $75,000 (0.015 * $5,000,000).

Therefore, the manager's total income, including their base salary, is $75,000 (base salary) + $75,000 (from profits) = $150,000.