A Business Is Deciding Whether to Give an End-Of-Year Bonus

question 1

Multiple Choice

A business is deciding whether to give an end-of-year bonus of $5000 each year for the next four years to an employee,in order to increase the number of sales that employee makes.What is the minimum extra profit the employee must generate this year for the bonus to be worthwhile over the next four years,if the discount rate is 7%?

• A)$12,263
• B)$14,480
• C)$16,936
• D)$20,000
• E)$18,600

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Definitions:

Real Solutions

Real solutions refer to the solutions of an equation that are real numbers, as opposed to complex or imaginary numbers.

Quadratic Equation

An equation of the form ax^2 + bx + c = 0, where a, b, and c are constants, and x is the variable.

Factoring

The process of breaking down an equation, polynomial, or number into its constituent elements or factors, such as finding the prime factors of a number or the factors of a polynomial.