The local bank will loan you $25,000 for 1 year at an interest rate of 12% with only one payment due at the end of the year. If you borrow the full $25,000 for the new engraver, what will the total cost of the loan be? Calculate the total amount of revenue (gross profit) that will be lost if the engraver breaks and is down for 18 business days. If the engraving business makes $975 per day in revenue and generates a net profit of 25%, how much profit is generated per day? Given a 25% profit margin and $975 per day in revenue, how many days would it take for the new engraver to earn back the total cost of purchase, if the entire net profit were allocated to pay for the unit? What other factors should you consider in order to make a good business decision?
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