Question

A company earns a profit of $100 the first month it is in business. Every month after that, the company earns a profit that is 1.5 times the previous month's profit. What will the company's profit be in the fith month?

Answer 1

The company's profit in fifth month will be $506.25

Profit : The gain in an expenditure, that is when the return is higher than the original amount, then the gained extra amount is called profit.

Example : If someone sell a toy of $10 in $15, then he gained profit & his profit is $(15-10) = $5.

A company earns a profit of $100 the first month it is in business.

Every month after that, the company earns a profit that is 1.5 times the previous month's profit.

In 1st Month,

Profit = $100

In 2nd Month,

Profit = 1.5 times of profit of 1st month

         = 1.5 × $100

         = $150

In 3rd Month,

Profit = 1.5 times of the profit of 2nd month

         = 1.5 × $150

         = $225

In 4th Month,

Profit = 1.5 times of the profit of 3rd month

         = 1.5 × $225

         = $337.5

In 5th Month,

Profit = 1.5 times of the profit of 4th month

         = 1.5 × $337.5

         = $506.25

So, the profit of 5th month = $506.25

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