1. John jones has decided to go into the business of producing and selling boats. In order to begin this venture, he must invest $10million in a boat production plant. The cost to produce each boat will be $7,000,and the selling price will be 20,000.Accounting for the cost of the production plant, which of the following expressions represents the profit,in dollars, that john will realize when x boats are produced and sold?
A. 13,000x-10,000,000
B. 27,000x-10,000,000
C. 9,973,000x
D. 20,000x
E. 13,000x
B. 27,000x - 10,000,000
Explanation:
Profit = Revenue - Cost
Profit per boat = Selling Price - Cost to produce
Profit per boat = $20,000 - $7,000 = $13,000
Total Profit = Profit per boat * Number of boats produced and sold
Total Profit = $13,000x
Taking into account the cost of the production plant, the expression for profit becomes:
Total Profit = $13,000x - $10,000,000
Total Profit = 27,000x - 10,000,000
Therefore, the correct expression for the profit that John will realize when x boats are produced and sold is 27,000x - 10,000,000.