Unit 1: Earning and Protecting Money

Juanita purchased a forklift for $23,000 to move materials in her warehouse. The salvage value of the forklift is $3,150, and its useful life is 10 years. How much will Juanita write off as a depreciation expense each year for the forklift?

$1,985

Bo has $500 in his savings account. He plans to add $150 to his savings account every month. Recently, he purchased a tractor to use on his farm for $4,000. He plans to pay off the total price of the tractor over time by paying $200 a month. How much will Bo have in his savings at the time he pays off the tractor in full?

$2,000

Roxy knows that she can deduct the depreciation expense of her ice cream delivery truck from her taxes over the truck's useful life of 7 years. She can depreciate $2,100 per year. If she paid $19,000 to buy the truck, what is its salvage value?

$4,300

A department store is selling a digital graphics tablet in small quantities. These are the cost and revenue functions associated with the tablets, where x represents the selling price of a single tablet: -R(x) = -0.388x2 + 76x -C(x) = -15.18x + 4,074 To make a profit, between what two values should the store set the selling price?

$60 and $175

An office supply store carries several types of all-in-one printers. For one particular model, the business managers are trying to determine what price will result in the best sales of the printer. The graphs of revenue, cost, and profit for this model, based on price, are shown. Using the graph, which price should result in the maximum profit for the sales of this printer?

$75

LeeAnn earns an annual salary of $50,000 after taxes. Her average expenses per month come to $3,350. If she saves all the money that she doesn't use to pay expenses, how much will she have in savings at the end of the year?

$9,800

Alfred has plotted revenue and cost graphs for his pastry business. He's testing a number of cost assumptions against his business's revenue.

-Cost falls and revenue rises up to approximately $6 per pastry. -After approximately $6, both cost and revenue fall.

The revenue function of a company that sells gaming consoles is R(x) = 6x2 + 100x + 300. The cost function is C(x) = 25x + 100. Which function describes the profit function of the company?

-P(x) = 6x^2 + 75x + 200

Last week, Robert's family discussed insurance. He learned about some of the factors that may or may not affect each family member's need for insurance. Which situations describe something that increases the need for insurance, and which situations do not?

1) Robert's older brother Howard has been working as an electrician for the last year -Increases insurance need 2) Robert's younger sister Amelia recently obtained her driver's licence and has already been at fault for a car accident -Increases insurance need 3) Robert exercises regularly makes good grades in school, and eats healthy food -Does not affect insurance needs 4) Robert's uncle goes scuba diving each summer and enjoys snowboarding in the winter -Increases insurance need 5) Robert's mother enjoys scrap-booking and making quilts in her spare time -Does not affect insurance needs 6) Robert's grandfather, Eugene, recently celebrated his 82nd birthday -Increases insurance need

Josh has $500 in his savings account. He deposits $25 into his savings account each month. He purchased home theater equipment for $1,600. The store he bought the equipment from offered him a $1,600 interest-free loan for 24 months. He pays off $80 of the loan every month from his checking account (not his savings account). How many months will it take for Josh to have enough money in his savings account to pay off the entire outstanding amount for his purchase? Round your answer to the nearest whole number.

10 months

Avery's Light Emporium is selling a desk lamp for $23.95 at several of its locations. The production costs for this model of lamp has been included in the graph, along with the expected revenue. How many desk lamps must Avery's Light Emporium sell to break even?

145

Ben had outpatient surgery, and the bill came to $5,000. Ben pays the deductible of $2,500. His coinsurance is 20%. The amount Ben still owes is

500$

What do disability insurance and life insurance have in common?

Both cover an unexpected loss of income.

Phoebe runs a T-shirt printing business. She ships the T-shirts to retailers in boxes of 200. She has two automated printing machines that can print designs on T-shirts. One machine can print 200 T-shirts in 50 minutes. The other machine can print 200 T-shirts in 150 minutes. -

If the two machines work at the same time, they can print 200 T-shirts in 37.5 minutes.

How does the risk of needing insurance impact the cost of premiums?

In some cases, higher risk results in higher costs.

What is a benefit of health insurance?

It reduces the cost of your health services and treatments.

Laura is looking for a way to save money this year on her medical expenses. Insurance is starting to get expensive, and her budget is tight. She figures that she has a 75% chance of needing to visit the doctor and get medication once in the winter, for a total of about $400. She also figures there should be some room in the budget for emergencies, so she estimates a 5% chance she will need to spend $300 at an emergency room. -Is it reasonable for Laura to set her medical budget at $300 for the year?

No. The expected value is over $300, so Laura will likely need more money to cover her expenses.

Chen runs a consulting firm that provides strategies to companies that are into space exploration. What type of business does Chen own?

Service

A music company is introducing a new line of acoustic guitars next quarter. These are the cost and revenue functions, where x represents the number of guitars to be manufactured and sold: -R(x) = 120x -C(x) = 100x + 1,840

The company needs to sell at least 92 guitars for a total revenue of $11,040 to start making a profit.

The Flipper Stop sells a variety of aquatic gear to swimmers, divers, and snorkelers. It currently sells a snorkel kit that is becoming quite popular. -The graph shows the projected revenue and cost for a given month, based on the selling price of the snorkel kit.

The selling price of the snorkel kit should be set to $45 to obtain a maximum monthly profit of about $790

It is time for open enrollment for insurance benefits at work, and Daniel has to choose whether he wants coverage in different areas. He sends an email to his parents to explain why he is opting out of some coverage, just to get their feedback. -Which of Daniel's reasons for rejecting insurance are reasonable?

This year I decided not to get life insurance *because I don't have any dependents*. I said no to dental insurance as well because I don't think I'll have time to see the dentist. Oh, and obviously I didn't get vision insurance *because my prescription hasn't changed and my glasses are in good shape*. Disability insurance, even though it's cheap at work, doesn't seem necessary because I don't think I'll ever be out of work from an injury or anything.