Question

The net income of the Apex Company was $110 million in 1995 and has been increasing by $30 million per year since. Over the same period, the net income of its

chief competitor, the Best Corporation, has been growing by $20 million per year, starting with $170 million in 1995. Which company earned more in 2004?
Apex Company
Best Corporation
In what year did/will Apex surpass Best?

Answer 1

Explanation:

In 2004, the net income of the Apex Company would be $110 million + ($30 million x 9 years) = $380 million.

The net income of the Best Corporation in 2004 would be $170 million + ($20 million x 9 years) = $350 million.

Therefore, Apex Company earned more in 2004.

To find the year when Apex surpassed Best, we need to set their net incomes equal and solve for time:

110 + 30t = 170 + 20t

10t = 60

t = 6

Therefore, Apex surpassed Best in the year 1995 + 6 = 2001.