If A invests $20,000 and B invests $30,000 in a business, and they earn a profit

If A invests $20,000 and B invests $30,000 in a business, and they earn a profit of $10,000, how much profit will A receive?

If A invests $20,000 and B invests $30,000 in a business, and they earn a profit of $10,000, how much profit will A receive?

Correct Answer: $4,000

Step 1: Identify the amount A invested, which is $20,000.
Step 2: Identify the amount B invested, which is $30,000.
Step 3: Calculate the total investment by adding A's and B's investments: $20,000 + $30,000 = $50,000.
Step 4: Determine A's share of the total investment by dividing A's investment by the total investment: $20,000 / $50,000.
Step 5: Simplify A's share: $20,000 / $50,000 = 2/5.
Step 6: Calculate A's profit by multiplying A's share (2/5) by the total profit ($10,000): (2/5) * $10,000.
Step 7: Simplify the profit calculation: (2/5) * $10,000 = $4,000.
Step 8: Conclude that A will receive a profit of $4,000.

Profit Sharing – Understanding how profits are distributed based on investment ratios.
Ratios and Fractions – Calculating shares of profit using ratios derived from investments.
Basic Arithmetic – Performing addition and multiplication to find total investments and profit shares.