Rice, Hepburn, and DiMarco Formed a Partnership with Rice Contributing

question 26

Multiple Choice

Rice, Hepburn, and DiMarco formed a partnership with Rice contributing $50,000, Hepburn contributing $30,000, and DiMarco contributing $20,000. Their partnership agreement called for the earnings division to be based on the ratio of capitalinvestments. If the partnership had a profit of $75,000 for its first year of operation, how much would be credited to DiMarco's capital account?

• A) $10,000.
• B) $30,000.
• C) $75,000.
• D) $15,000.
• E) $20,000.

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Definitions:

Economic Models

Simplified representations of complex economic processes, used to predict and analyze economic behaviors and outcomes.

Complexity Of Reality

The notion that real-world situations are intricate due to interconnections and interdependencies among various elements and variables.

Simplifications

The process of making something easier to understand or do by reducing its complexity.

Trade-Offs

Decisions made that involve a sacrifice of one thing to obtain another, often used in discussions of economic and personal choices.