Each week, Leon has fixed expenses of $1,250 at his furniture shop. It costs him $150 to make a chair in his shop, and he sells each chair for $275. What is Leon’s profit if he makes and sells 25 chairs in 1 week?
- A$1,875
- B$2,500
- C$3,125
- D$4,375
Show the answer
Correct answer: A
Each chair costs Leon $150 to make, and he sells the chair for $275.
His profit is found by subtracting the cost from the price:
$275 − $150 = $125 per chair
If Leon makes and sells 25 chairs in a week, his initial profit is
25 × $125 = $3,125
However, Leon has additional fixed expenses of $1,250 per week, so this cost must also be subtracted to arrive at the profit. His final profit is
$3,125 − $1,250 = $1,875