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GaryK [48]
3 years ago
14

Present value​ (with changing interest​ rates). Marty has been offered an injury settlement of ​$12 comma 000 payable in 3 years

. He wants to know what the present value of the injury settlement is if his opportunity cost is 5​%. ​ (The opportunity cost is the interest rate in this​ problem.) What if the opportunity cost is 6.5​%? What if it is 11.5​%?
Business
1 answer:
lesantik [10]3 years ago
8 0

Answer:

If opportunity cost is 5%, PV=10,366.05

If opportunity cost is 6.5%, PV=9,934.19

If opportunity cost is 11.5%, PV=8,656.79

Explanation:

PV=Σ(\frac{CF_{t} }{(1+i)^{t} })

If opportunity cost is 5%: PV = \frac{12,000 }{(1+0.05)^{3} } =10,366.05

If opportunity cost is 6.5%: PV = \frac{12,000 }{(1+0.065)^{3} } =9,934.19

If opportunity cost is 11.5%: PV = \frac{12,000 }{(1+0.115)^{3} } =8,656.79

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The people in an economy have $25 million in money. There is only one bank where they deposit their money and it holds 10% of th
Klio2033 [76]

Answer:

The people in an economy have $25 million in money. There is only one bank where they deposit their money and it holds 10% of the deposits as reserves. What is the money multiplier in this economy?

D. 10

Explanation:

10% of $25, 000, 000= $2,500,000

Money multiplier in this economy is by 10

6 0
3 years ago
The difference between a nominal variable and a real variable is that A. real variables are calculated in​ current-year prices a
Oksanka [162]

Answer:

Option (D) is correct.

Explanation:

Nominal variables are the variable which are calculated on the basis of current market prices such as nominal GDP. Nominal GDP incorporates all of the changes happened in a current year such as changes occured in the inflation or deflation in a current year.

On the other hand, real variables are those variables which are calculated on the basis of base year prices to take the effects of the inflation or deflation during the period of time. For example, Real GDP. real GDP is determined by the market prices of the base year, so that one can compare the actual effect effect of inflation or deflation during a period of time.

3 0
3 years ago
A cash-basis sole proprietor had the following cash receipts and disbursement for the year: Net sales - $80,000 Cost of goods so
DIA [1.3K]

Answer:

Net Income is $17,000

Explanation:

A sole proprietor is not taxed as a business entity but all the income and expenses should be reported on the income tax return. On schedule C all the details of profit and loss should be submitted with Form 1040.

Net profit calculation to report on Schedule C is as follow:

Net sales -                          $80,000

Cost of goods sold           <u>($40,000)</u>

Gross Income                    $40,000

Operating expenses        <u>($20,000)</u>

Operating Income             $20,000

Employee payroll taxes   <u>($3,000)</u>

Net Income                       <u> $17,000 </u>

3 0
3 years ago
A set of strategies and activities that influences how we conduct business, the clothes we wear, where we live, and how we spend
vladimir1956 [14]

Answer:

The correct answer to the following question will be "Marketing".

Explanation:

  • Marketing is the analysis and administration of the partnership of trade. It's the corporate process of making partnerships with and rewarding clients.
  • Since marketing is being used to retain customers, which is one of the primary components of business and its management.
  • It's a collection of tactics and practices that affect how we do business, the clothing we wear, where we sleep, and how we spending our money or time and focus our efforts.

Therefore, Marketing is the right answer.

3 0
3 years ago
In a business franchise, who develops the product and business systems?
vladimir2022 [97]

Answer:

It depends on the type of business franchise.

In a business format franchise, the franchise will provide the franchisee all of the necessary things for a product + business system like marketing assistance, machines, supplies, etc... An example of this would be a fast food restaurant or a retail store.

In a product distribution franchise, the work is all up to the franchisee. The franchise will provide the logo and the right to sell its product but leaves the rest of the work to the franchisee. An example of this would be a car dealership or a gas station.

6 0
3 years ago
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