Pam runs a hot dog cart at the sports stadium. Will has no skills, no job experience, and no alternative employment. Entrepreneurs in the hot dog cart business earn $16 comma 000 a year. Will pays the rent of $500 a year, and his total revenue is $21 comma 000 a year. He borrowed $500 at 15 percent a year to buy equipment. At the end of one year, Will was offered $300 for his business and all its equipment.

Question

Lorelei Murillo

Business

29 July, 21:53

Pam runs a hot dog cart at the sports stadium. Will has no skills, no job experience, and no alternative employment. Entrepreneurs in the hot dog cart business earn $16 comma 000 a year. Will pays the rent of $500 a year, and his total revenue is $21 comma 000 a year. He borrowed $500 at 15 percent a year to buy equipment. At the end of one year, Will was offered $300 for his business and all its equipment.

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Answers (1)

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Georgia Vaughn · Answer 1

rate of return of fund = 3.66%

Explanation:

start = 327/23 = 14.22

end = 349/29 = 12.04

distributions = 1.5 + 1.2 = 2.7

rate of return of fund = 12.04-14.22 + 2.7 / 14.22

= 3.66%