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Black_prince [1.1K]
2 years ago
13

In the year 2000, McDonald's was running a game called Monopoly. For every item you purchased at the restaurant, you earned a ti

cket to enter into the game. The highest prize offered two options: (a) $1,000,000 in one installment; or (b) $100,000 to be paid annually during 15 years, starting with one installment at the year 2000. Suppose that the interest rate is 10%. Which option would a savvy financial investor prefer
Business
1 answer:
mamaluj [8]2 years ago
5 0

Option a - $ 1000000 in one instalment

Option b - $100000 to be paid annually during 15 years, starting with one instalment at the year 2000

Interest rate = 10%

Which option would a savvy financial investor prefer

PV of Option a = 1000000 * 1 = $ 1000000

PV of option b = 100000 * PVIFA(10%,15)

PV of option b = 100000 * 7.6060795 = $ 760608

The PV of option a is higher, hence prefer the option a

Learn more about financial investor here brainly.com/question/25572872

#SPJ4

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In some instances accounting principles require a departure from valuing inventories at cost alone. Determine the proper unit in
Zepler [3.9K]

Answer:

1   $12.80

2   $16.10

3   $13.00

4   $9.20

5   $15.90

Explanation:

The unit value of inventory is to be valued  the lower of cost price and net realizable value.

Cost is the original purchase price while the net realizable value is the estimated selling price less of costs to complete and costs to sell as computed in the attached file.

Download xlsx
3 0
3 years ago
I need help on number 8 9 and 10 please help
elena55 [62]

Answer:

8. The opportunity cost is c. wearing the shoes

9. To gain the most satisfaction possible

10. A new toy is less exciting to a child with many toys

Explanation:

3 0
3 years ago
Nunavet Ocean Cruises sold an issue of 12-year ​$1,000 par bonds to build new ships. The bonds pay​ 4.85% interest, semi-annuall
frez [133]

Answer:

bond market value $660

Explanation:

We need to calculate the present value of the maturity and the cuopon payment using the effective rate of 9.7%

First we do the annuity:

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C  24.25  (1,000 face value x 4.85 bond rate / 2 )

time  24.00 (12 year 2 payment a year)

rate  0.04850 (current rate divide by 2 to get it annually)

24.25 \times \frac{1-(1+0.0485)^{-24} }{0.0485} = PV\\

PV $339.55

Then present value of the maturity

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity   1,000.00 the face value of the bond

time   24.00

rate   0.04850

\frac{1000}{(1 + 0.0485)^{24} } = PV  

PV   320.89

Finally we add them together:

PV coupon payment $339.5545

PV maturity  $320.8910

Total $660.4455

rounding to nearest dollar

bond market value $660

7 0
3 years ago
At the beginning of the video, we learn that Rosalie’s sales numbers have declined. The Marketing Director, Product Development
Volgvan

Answer:

The answer is letter A. Environmental Scanning.

Explanation:

At the beginning of the video, we learn that Rosalie’s sales numbers have declined. The Marketing Director, Product Development lead, and Sales Manager proceed to engage in a broad discussion of the different factors that may have led this decline. They are engaging in a process known as _Environmental Scanning._______.

5 0
3 years ago
What is meant by allocative efficiency? Allocative efficiency is when every good or service A. is produced up to the point where
Alborosie

Answer:

Option (E) is correct.

Explanation:

Allocative efficiency is created when the gap between marginal benefit and marginal cost is maximum. The marginal benefit is the benefit that a consumer can get by consuming an additional unit of a commodity and the marginal cost is the cost that a producer incurred by producing an additional unit.

Hence, the allocative efficiency is achieved where the difference between these two terms is maximized.

5 0
3 years ago
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