Prof. Templeton makes and sells wooden widgets from his back-yard for $150 each. His only costs are for materials. It takes him two hours to make a wooden widget. He sold 150 last year, for a profit of $7,500. This year he raises the price by 15%, but sells 30% fewer widgets. Assuming his cost for making each widget hasn't changed…
A.)Does his profit increase or decrease?
B.)By what percentage does his profit change?
C.)What is the percentage change in his profit-per-hour-of labor?
D.)Will the IRS come after him for income tax after seeing this post?