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    Profit/loss equation

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    Compute the following:

    A company grosses $100 million per year and shows a 12 percent profit. It hires a security director, a security staff, and security equipment, which costs the company $2 million per year but reduces its losses, or "shrinkage," from 9 percent to 5 percent of the gross.

    How much money is the company making or losing as a result of installing a security program?

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    Solution Preview

    Answer: The company earns $2 million more as a result of installing a security program.

    Without installing of this security program, the company's profit is $100 * 12% = ...

    Solution Summary

    This provides an example of writing an equation for a word problem.