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Sophie [7]
4 years ago
11

A method by which one can compare cash flows across time, either as what a future cash flow is worth today (present value) or wh

at an investment made today will be worth in the future (future value) is called Group of answer choices
Business
1 answer:
11111nata11111 [884]4 years ago
4 0

Answer:

Time value of money

Explanation:

The time value of money refers to the financial concept which said that the value at present would generate higher benefit than in the future period. It is also known as discounted value at present

The formulas are shown below:-

Present Value = Future Value ÷ (1 + Discount Rate)

Future Value = Present Value × (1 + Discount Rate)

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You and a group of friends are planning to visit a theme park, which charges $60 for admission, $100 for a two-day pass, and $13
enyata [817]

Answer:

<u><em>Part 1. </em></u>

  • <em>Average cost per day of a three-day pass</em> =  $53.33/day per person

  • <em>Marginal cost of adding the third day </em>= $190 - $160 = $30 per person

<em />

<em><u>Part 2.</u></em>

  • <em>Group's marginal cost of switching from the two-day pass to the three-day pass</em> = $180

Explanation:

The total <em>cost</em> is the <em>admission charge</em> ($60) plust the cost of the pass ($100 or $130).

For a <em>two-day pass</em> that is: $60 + $100 = $160, per person

For a <em>three-day pass</em> that is: $60 + $130 = $190, per person

<u><em>Part 1. The average cost per day of a three-day pass per person. </em></u>

The <em>average cost</em> is the total cost divided by the number of days.

  • <em>Average cost</em> = $160/3days = $53.33/day per person

The <em>marginal cost of adding the third day</em> per person is found by subtracting the total cost for two days from the total cost for three days:

  • <em>Marginal cost of adding the third day</em> = $190 - $160 = $30 per person

This says that althoud the average cost for the three days is $53.33 the cost of adding the third day is $30, which is much lower; thus, it is a good deal to buy a three-days pass, as they are interested in spending a lot of time there.

<u><em>Part 2. The group's marginal cost of switching from the two-day pass to the three-day pass</em></u>

<em></em>

Since the <em>marginal cost of switching from the two-day pass to the three-day pass</em> is $30 per person, the marginal cost for the 6-person group is 6 times $30:

  • 6 persons × $30/person = $180.

8 0
3 years ago
Cray Company started year 2 with $60,000 in its cash and common stock accounts. During year 2 Cray paid $45,000 cash for employe
son4ous [18]

Explanation:

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7 0
4 years ago
Read 2 more answers
you are a euro-based portfolio manager and you have invested in the technology sector of the U.S. stock market. You want to keep
yanalaym [24]

Answer: You enter into Euro/USD forward contract.

Explanation:

Based on the information given in the question, the best way to manage the dollar currency risk is to enter into Euro/USD forward contract.

A forward contract is a contract between two parties whereby an asset is being bought it sold at a particular price in the future. It should be noted that forward contract is good for speculations.

4 0
3 years ago
Cash generated by the regular operations of a business; usually computed as net income plus or minus the effects of other curren
Oliga [24]

Cash generated by the regular operations of a business; usually computed as net income plus or minus the effects of other current assets and current liabilities on cash flows, plus noncash expenses deducted in arriving at net income, minus noncash revenues included, less certain gains and plus any losses that are included in the total proceeds received from sale of fixed assets is given below

Explanation:

  • Cash flows from operating activities show the net amount of cash received or disbursed during a given period for items that normally appear on the income statement. You can calculate these cash flows using either the direct or indirect method.
  • The direct method deducts from cash sales only those operating expenses that consumed cash. This method converts each item on the income statement directly to a cash basis.
  • Alternatively, the indirect method starts with accrual basis net income and indirectly adjusts net income for items that affected reported net income but did not involve cash.
  • The Statement of Financial Accounting Standards No. 95 encourages use of the direct method but permits use of the indirect method.
  • Whenever given a choice between the indirect and direct methods in similar situations, accountants choose the indirect method almost exclusively. The American Institute of Certified Public Accountants reports that approximately 98% of all companies choose the indirect method of cash flows.
  • The direct method converts each item on the income statement to a cash basis.
  • The indirect method adjusts net income (rather than adjusting individual items in the income statement) for (1) changes in current assets (other than cash) and current liabilities, and (2) items that were included in net income but did not affect cash.
  • The most common example of an operating expense that does not affect cash is depreciation expense.
5 0
3 years ago
in 2006, selected automobiles had an average cost of $16,000. The average cost of those same automobiles is now $28,000. What wa
Nonamiya [84]
Thank you for posting your question here at brainly. I hope the answer will help you. Feel free to ask more questions.

The  rate of increase for these automobiles between the two time periods is <span>75 percent.

Below is the solution:

</span><span>($28,000 – $16,000) / $16,000 = .75 (75 percent)</span>
5 0
3 years ago
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