A company had a profit of $350,000 in its first year. Since then, the company's profit has decreased by 12% per year. Assuming this trend continues, what is the total profit the company can make over the course of its lifetime? Round your answer to the nearest dollar.

The total profit the company can make over the course of its lifetime is $2,916,666.67.

Given:

Profit=$350,000

Decreased in profit=12%

Hence:

Total profit=$350,000/[1-(1-.12)]

Total profit=$350,000/(1-.88)

Total profit=$350,000/.12

Total profit=$2,916,666.67

Inconclusion the total profit the company can make over the course of its lifetime is $2,916,666.67.

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Sn = $2,916,666.67

Explanation:

Given:

First year profit (PV) = $350,000

Rate of trend (r) = -12% = -0.12

It is assume that firm doing his business continuously.

Formula to find geometric mean:

It is assumed that firms using the sum of geometric formula to find the trend.

Sn = a[1/Rate of trend]

Sn = $350,00[1/0.12]

Sn = $2,916,666.67

cognitive overload: having a lot on your mind impairs decision-making and tends to result in the simplest, but not necessarily best, option being selected.

empathy gaps: overlooking how you might feel in a different situation can result in unnecessary purchases, such as overbuying when shopping for food on an empty stomach.

optimism and overconfidence: wearing rose-tinted glasses and having unrealistic expectations about the future can affect money management and leave you unprepared for a change in circumstance.

instant gratification: seeking instant gratification drives impulsive spending and can undermine long-term planning and savings.

harmful habits: automatic or mindless behaviour can amplify a poor financial decision as it becomes a recurring event.

social norms: we are heavily influenced by the actions of others; while this can be in certain circumstances, it also contributes to the pressure to keep up with the joneses through conspicuous consumption.

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