Suppose a company forecasts that the demand for its product will increase by 10% next year. If the current demand is 5,000 units, what will the expected demand be next year?

• A. 6,000 units
• B. 5,500 units
• C. 5,050 units
• D. 4,500 units

Answer: (B)

Verified step by step guidance

1. Identify the current demand, which is given as 5,000 units.
2. Understand that the demand is expected to increase by 10%, which means the new demand will be the current demand plus 10% of the current demand.
3. Express the increase mathematically as: \(\text{Increase} = 0.10 \times 5,000\).
4. Calculate the expected demand by adding the increase to the current demand: \(\text{Expected Demand} = 5,000 + (0.10 \times 5,000)\).
5. Simplify the expression to find the expected demand for next year.