Philadelphia Swim Club is planning for the coming year. Investors would like to earn a​ 10% return on the​ company's $ 38 comma 000 comma 000$38,000,000 of assets. The company primarily incurs fixed costs to maintain the swimming pools. Fixed costs are projected to be $ 12 comma 900 comma 000$12,900,000 for the year. About 550 comma 000550,000 members are expected to swim each year. Variable costs are about $ 14$14 per swimmer. Philadelphia Swim Club is a priceminus−taker and​ won't be able to charge more than its competitors who charge $ 38$38 for a membership. What profit will it earn as a percent of​ assets?

Question

Philadelphia Swim Club is planning for the coming year. Investors would like to earn a​ 10% return on the​ company's

$ 38 comma 000 comma 000$38,000,000

of assets. The company primarily incurs fixed costs to maintain the swimming pools. Fixed costs are projected to be

$ 12 comma 900 comma 000$12,900,000

for the year. About

550 comma 000550,000

members are expected to swim each year. Variable costs are about

$ 14$14

per swimmer. Philadelphia Swim Club is a

priceminus−taker

and​ won't be able to charge more than its competitors who charge

$ 38$38

for a membership. What profit will it earn as a percent of​ assets?

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