trevor has just finished writing a deeply profound book titled, the longer i live, the older i get. the publisher has given him two options: receiving $20,000 up front and 8% of the sales of the book or $50,000 up front and 5% of the sales of the book. What do the sales have to be for trevor to make the same amount for each option
Let's denote the total sales of the book as S.
For the first option, Trevor will receive $20,000 up front and 8% of the sales, which is 0.08S.
Total earnings for the first option = $20,000 + 0.08S
For the second option, Trevor will receive $50,000 up front and 5% of the sales, which is 0.05S.
Total earnings for the second option = $50,000 + 0.05S
To find the point where Trevor makes the same amount for each option, we set the two total earnings equal to each other:
$20,000 + 0.08S = $50,000 + 0.05S
0.03S = $30,000
S = $30,000 / 0.03
S = $1,000,000
Therefore, the sales have to be $1,000,000 for Trevor to make the same amount for either option.