Answer:
$1,565
Explanation:
Enter the following inputs into financial calculator, we will have:
n = 3 years
Present value (PV): The amount that you should pay for the annuity. This is the missing value we need to calculate
Future value (FV): FV = 0, there is no future value of an annuity
PMT: The amount that annuity pays per year. ($850)
i/r = 5.5%: The interest you expect to receive from the annuity
PV = $1,484
Since the payment is made at the beginning of each year, you should multiply the PV amount by (1+0.055)
The final answer would be 1,484 x 1.055 = $1,565
The most you should pay is $1,565
Avon used Direct Sales Model Strategy until the mid-2000s. It is a method wherein the business's own employees are in direct contact with buyers as they sell their products.
The advantages of direct sales model are:
1) strong customer relations
2) coordination with other effective business strategies
3) price and cost control
4) access to more customers
The disadvantages of direct sales model are:
1) more expensive compared to other marketing strategy
2) time consuming during sales calls or talks.
3) can be inconvenient or intrusive to clients or consumers.
