1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
djverab [1.8K]
3 years ago
6

A company is evaluating an investment which has an initial investment of $4,000. Annual net cash flows is expected to be $2,000

over the next three years. The company requires a 10% annual return. The present value of an annuity factor for 10% and 3 periods is 2.4869. The present value of $1 factor for 10% and 3 periods is 0.7513. The net present value is (round your answer to the nearest whole dollar).
Business
1 answer:
uysha [10]3 years ago
4 0

Answer:

The NPV of the project is $974.

Explanation:

The net present value is the today's value of a stream of cash flows. The net present value will be the sum of all the expected future cash flows from a project less the initial investment required for the project and it is used to evaluate the investment decisions.

The net present value of an investment project will be:

NPV = CF1 / (1+r) + CF2 / (1+r)^2 + ... + CFn / (1+r)^n - Initial investment

or

If the cash flows are constant or of same amount through out, occur after the same interval of time and are for a defined period of time, they become an annuity and the NPV of such a project can be calculated by,

NPV = (Cash flow per period * Present value of Annuity factor) - Initial cost

The NPV of this project will be = (2000 * 2.4869) - 4000 = 973.8 rounded off to $974

You might be interested in
No trespassing signs are an example of owners enforcing their right to
Ilia_Sergeevich [38]

Answer:

I guess the ans is their right to exclude people from your property.

4 0
3 years ago
It is important for managers of corporations to act ethically​ ___________. ​(Select the best choice​ below.) A. because a viola
scZoUnD [109]

Answer: B. because it is important for a business to be trusted by investors, customer and the public if it is to succeed

Explanation: Ethics is defined as the set of moral principles and standards or judging whether something is right or wrong and as such, it is quite vital for managers of corporations, firms and businesses to act in an ethical manner. This is because it is important for a business to be trusted by investors, customer and the public if it is to succeed in both the short and long term.

7 0
3 years ago
A country reported nominal GDP of $115 billion in 2010 and $125 billion in 2009. It also reported a GDP deflator of 85 in 2010 a
ICE Princess25 [194]

Answer:

<h2>In this case,the correct answer is option b. or real output rose and price level fell.</h2>

Explanation:

GDP Deflator in Macroeconomics,shows the inflation or deflation rate in a country within the specific time period.Hence,it measures the changes in the average price level of goods and services in any country or economy over a particular period of time.It is mathematically calculated by dividing the nominal GDP of the country or economy by its real GDP.Now,a decrease in the nominal GDP relative to the real GDP or GDP deflator implies an deflationary impact or an increase in the average price level of goods and services in the economy and vise versa.Note that in this case both the nominal GDP and GDP deflator decreased from 2009 to 2010 which advocates that the price level in the economy fell(deflation) and the real output or GDP rose or increased due to deflationary impacts as reflected by the decline in GDP deflator.

5 0
3 years ago
Critically discuss the economic importance of the secondary sector to the south African economy.​
LuckyWell [14K]

Wait ⚠️

This question is from quizlet

4 0
3 years ago
When would your credit card company charge you an overlimit fee?
Anna71 [15]
D) when you charge more than your current credit limit
Why: because my sister has done it and I did that question in my school
Hope this helps good luck!!
5 0
2 years ago
Other questions:
  • The Donaldson Furniture Company produces three types of rocking​ chairs: the​ children's model, the standard​ model, and the exe
    11·1 answer
  • The value of a cash budget is that it helps you predict and supply your future cash needs.true or false
    8·1 answer
  • Starbucks has hired you to make a systematic inventory of its competitive capabilities. To do so, you would conduct an assessmen
    10·1 answer
  • A customer bought a $1,000 par convertible subordinated debenture at par, convertible into common at $32 per share. If the bond'
    5·1 answer
  • Over the last half century, the percentage of the U.S. labor force working in manufacturing thas
    12·1 answer
  • What is home equity?
    11·2 answers
  • Adams operates his $57500 firm using his own equity. Bob operates his firm with $28750 of his own money plus $28750 of debt at a
    9·1 answer
  • Rainbow Paints Inc. is a leading paints company in Pakistan. In June 2019, the higher management of the company deliberated and
    5·1 answer
  • Which of the following is considered a "diversified" investment?
    14·1 answer
  • List the steps in allocating costs to operating departments and preparing departmental income statements, with the first step on
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!