if they were invested in a bank instance as deposits of private persons (from the owners of the company, who also work in it) without the need for existing of the company. Saying it otherwise, the left part gives us the profit of a small company, and the right part is a sum of the average salary and the profit from the spent in the company money, if it was not a company and only the used in an year money were standing on personal deposit. If we now leave on the one part only the letter

a

and solve the equation in regard to it we will have:

a = e /( (1-b)(1-d) - b*c )

     (2)

what is our

final formula

.

     In order to answer the set in the beginning question we must decrease the number of variables, giving to some of them values as near as possible to the real ones. We shall begin in reverse order of the letters, i.e.:

e = 100,000

lv in an year — a nice round number, maximally close to the average working salary for the current year (it is not yet exactly calculated, for the year has not yet ended), what gives by 8,000 lv net in month (or, else, nominally 120,000 lv in an year).

d = 0.3

, i.e. 30% — this is the profit tax for the smallest companies with profit less than 1 mln lv yearly and for the new registered such, what is the lowest tax at all (usually it is 40%, and even more) and this, respectively, is the best for us case.

c = 1.4

or 140%, whal looks a good approximation to the real situation, because in the beginning of the year the annual bank interest was 40%, in the middle of the year it become about 120% (for GS out of portfolio emissions of trading banks), in September the most secure bank, the National Bank of Bulgaria (BNB), has issued bonds with yearly interest of 130%, and the trading banks sold GS with 170% annually. Such was the case till the end of September (revolutionary month, at least for Bulgarian people — there were pair of revolution in Bulgaria in the first half of 20th century on this month), and now the newest information is that the basic interest rate (BIR) have become 300% and if it will stay so till the end of the year (i.e. "

if our state will exist

", as some wicked thongs say) can be expected that this will give averaged

real

gain about 160% in year (what is more than our gain of the averaged BIR), but we "out of modesty" will work with 140%, for to be sure that our estimation is not inflated.

     Then the formula (2) takes the form:

a = 100,000 /( 0.7(1-b) - 1.4 b ) = 100,000 /( 0.7 - 2.1 b )

     (3)

what is the relationship of the profit

a

of small company depending on the material consumption of production (part of the expenses to the profit)

b

.

The first conclusion

, that we may draw out of this, is that there

exists

critical

or

maximal value of b

, and it is critical because the denominator of (3) turns to zero (and, as all of us have studied in school, it is forbidden to divide to zero) and maximal, because for

b

greater than this value the denominator becomes negative, and, respectively,

a

becomes negative, what has no meaning, because negative money means that the company looses if it works. Put it otherwise, the company begins to work for "that who blows" exactly by the maximal value of

b

. In our (most lucrative in relation to the taxes) case this value is:

b_max = 0,7 / 2,1 = 0,33

or

33%

.

     Let us now show this relationship in table form:

b (in %)152023252730a (ths lv)2603574605717501430

TABLE 1. DEPENDENCE OF b FROM a.

     As far as there are no companies with less than 20% expenses (at least 10% go for the cheapest advertisement), neither there is somebody with up to such extent "weathered" brains for to earn one and a half millions (working with no gain, because that is what we calculate here!), then it turns that the left and the right end of the table are unusable. (Besides, when the profits are more that 1 mln levs the taxes

d

will be bigger, so that the expression for

a

will be different). In this situation remains the possibility by material consumption

b

of about 25% to get profits of half a million levs. But these are theoretical results because, practically, there is no such company that will spend less than 30% (even for freelancing professions are allowed 30% inherent necessary expenses without supplying documents). In other words, from the stated till here unambiguously follows that

there are no conditions at all in Bulgaria for small business

under this inflation level, and if someone, still, continues to perform such activity, than this is either by inertia, or because he simply cannot find a job!

     At a first glance here is concealed some "magic", because the company must not have all the money for the expenses for the year in the beginning of it, and if it turns 3-4 times the production cycle it will happen that it is possible to work also with smaller amounts in cash (and, respectively, the profit from bank interest in our calculations will fall down), and if the company bakes buns and pies, for example, then it will turn hundred cycles in an year. But in this situation we do not take into account the necessity for availability of stock, and expenses primarily for basic means of production (BMP), where one has to "throw away" at once the money at least for five years in advance and this in very big amounts, where

the amortization becomes

directly eaten by the inflation

! And if we speak about production premises and equipment (and in our climatic conditions, as it is known, nothing can