Question
Mountaintop golf course is planning for the coming season. Investors would like to earn a 12% return on the company's $45,000,000 of assets. The company
Mountaintop golf course is planning for the coming season. Investors would like to earn a 12% return on the company's $45,000,000 of assets. The company primarily incurs fixed costs to groom the greens and fairways. Fixed costs are projected to be $24,000,000 for the golfing season. About 440,000 golfers are expected each year. Variable costs are about $17 per golfer. Mountaintop golf course is a priceminustaker and won't be able to charge more than its competitors who charge$119 per round of golf. What profit will it earn as a percent of assets?
A.
Loss of 85.94
B.
Profit of 46.4
C.
Loss of 46.4
D.
Profit of 142.95
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