Maureen left her teaching job, which paid $30,000 per year, and invested $20,000 of her retirement fund (which was earning 10 percent interest) in a new real estate business.Her accountant predicted a $60,000 revenue the first year.Her husband, an economist, forecast her profit to be
A)$10,000.
B)$28,000.
C)$32,000.
D)$60,000.

Question

Quizplus · Accepted Answer

Maureen's total income for the first year would be $30,000 (from her teaching job) + $20,000 x 0.1 (from her investment) + $60,000 (from her real estate business). This equals $53,000. 
Since her husband is an economist and would take into account her expenses for the real estate business, it is likely that his profit forecast would be higher than simply subtracting her initial investment from her total income. Therefore, option B, $28,000, is the most reasonable choice.

Maureen Left Her Teaching Job, Which Paid $30,000 Per Year