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Ratling [72]
3 years ago
7

As a financial advisor, what will you tell your client, Ryan, he should be willing to pay for an investment property that he pla

ns to buy today and hold for 5 years and then sell, given the following cash flows and the fact that he expects 9% on any investment he makes?
Inflows Outflows Net
InitialOutlay $0
Year 1 $45,000 $55,000 10,000
Year 2 55,000 20,000 35,000
Year 3 55,000 20,000 35,000
Year 4 255,000 235,00 220,000
A. $189, 910.29.
B. $194, 589.33.
C. $178, 656, 73.
D. $191, 231, 57.
Business
1 answer:
kvv77 [185]3 years ago
5 0

Answer:

The option (A) $189, 910.29 is correct

Explanation:

Solution

Given that

Years Net Cash flow Discount Factor at 11% Present Value

1        $ (10,000.00)               0.901                         $(9,009.01)

2        $ 35,000.00               0.812                         $ 28,406.79

3        $ 35,000.00               0.731                         $ 25,591.70

4        $ 220,000.00               0.65                        $ 144,920.81

Now,

The Net Present Value                                           $189,910.29

Thus

After carrying out the  financial analysis, it has been seen that if we go ahead to buy the Investment Property, then today we have Net present Value of $ 189,910.29.

So, i will inform my client to buy the Investment Property.

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Citrus2011 [14]

Answer:

(A) 18,400 units

(B) 12,940 units

Explanation:

The computation of the equivalent units of production for

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(B) Conversion  =  Units transferred out +  (Ending work in process × conversion percentage)

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3 years ago
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Answer:

d

Explanation:

A perfect competition is characterized by many buyers and sellers of homogenous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.  

In the long run, firms earn zero economic profit.  If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.  

Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.  

Perfectly competitive market consists of a large number of firms, and each firm is small relative to the entire market. This makes firms unable to set the prices for their goods.

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Answer:

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