Saeed needs money to purchase tools, basic office supplies, parts to refurbish equipment, accounting software, and legal help fees. Believing Saeed's business will be a success, an investor invests $5,000 to help Saeed open his business. In return, Saeed agrees to repay the investor the $5,000 plus 17 percent of the profits of the business. Calculate the return on investment for the investor if Saeed's business makes $7,000 in profit as a total return of the business in its first year.

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Tinytrevi3518 Tinytrevi3518

21-06-2019
Business

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Saeed needs money to purchase tools, basic office supplies, parts to refurbish equipment, accounting software, and legal help fees. Believing Saeed's business will be a success, an investor invests $5,000 to help Saeed open his business. In return, Saeed agrees to repay the investor the $5,000 plus 17 percent of the profits of the business. Calculate the return on investment for the investor if Saeed's business makes $7,000 in profit as a total return of the business in its first year.

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dispyskirden dispyskirden · Answer 1 · 2019-07-03T17:29:15+02:00

Answer:

The return of investment for the investor if Saeed's business makes $7000 in profit in its first year is $6190.

Explanation:

Saeed agrees to repay the investor the $5000 plus 17 percent of the profits of the business. This can be represented by this equation.

Return of investment for the investor= initial investment+ (percentage of profits X profit)

When we fill in our known numbers, this is the equation. Remember, the profit for the first year was $7000.

Return of investment for the investor = 5000 + (.17 X 7000)

Return of investment for the investor = 5000 + 1190

Return of investment for the investor = $6190

shristiparmar1221 shristiparmar1221 · Answer 2 · 2022-04-19T16:43:40+02:00

The return of funding for the investor if Saeed's enterprise makes $7000 in income in its first year is $6190.

What is the amount which the investor get?

Saeed is of the same opinion that paying off the investor the $5000 plus 17 percent of the income of the enterprise is the best decision. This may be represented with the aid of this equation.

Return on investment for the investor = initial funding + (percentage of income X income)When we fill in our recognized numbers, that is the equation.

Remember, the income for the primary year was $7000. The investor's return on investment equals 5000 + (.17 X 7000).

The investor's return on investment is equal to 5000 + 1190.The investor's return on investment is $6190.

Therefore, from the above equation the total amount which investor gets is 6190$.

Learn more about equation, refer to:

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