All categories

3 years ago

The following is the cash flow from a manufacturing plant in the next five years:

Business

1 answer:

Svetllana [295]3 years ago

6 0

Answer:

The sum of the present values of the stream of cash flows is $1,011,772.58

Explanation:

We need to compute the present value of the cash flows separately for each amount

The first cash flow is occurring at the end of the first year

We use the formula PV = FV/(1+i)^n

Where PV = Present Value, FV = Future value, i = Interest rate, which is the rate at which the cash flows are to be discounted and n = the year in which the cash flow occurs

Plugging the values in the formula, we get the present value for the first year

PV = 250,000/(1+0.065)^1 = 250,000/1.065 = 93,896.71= $93,896.71

The present values for the successive years are provided as under

PV = 20,000/(1+0.065)^2 = 20,000/(1.065)2 = 17,633.1857= $17,633.1857

PV = 180,000/(1+0.065)^3 =180,000/(1.065)3 = 149,012.8365= $149,013.8365

PV = 450,000/(1+0.065)^4 =450,000/(1.065)4 = 349,795.3909= $349,795.3909

PV = 550,000/(1+0.065)^5 =550,000/(1.065)5 = 401,434.4601= $401,434.4601

Adding up the present values for each of the years, we obtain the present value of the cash flow stream

93,896.71+17,633.1857+149,013.8365+349,795.3909+401,434.4601 = $1,011,773,.58 approximately (only the final answer is rounded off to two decimal points)

The solution in word format is also attached here

Download docx

You might be interested in

Stryker Industries received an offer from an exporter for 27,000 units of product at $17 per unit. The acceptance of the offer w

Aloiza [94]

Answer:

$162,000

Explanation:

Income Statement - New Offer

Sales (27,000 x $17) $459,000

Less Variable Costs of the offer :

Variable manufacturing costs (27,000 x $11) ($297,000)

Net Income (Loss) $162,000

therefore,

the amount of income from the acceptance of the offer is $162,000

7 0

3 years ago

Which of "the following employee groups is MOST likely to "be excluded by the NLRB from participating in organizing activities a

Bingel [31]

Answer:

C) Employees with certain supervisory duties

Explanation:

The NLRB organization consists of:

1) The Board – have 5 members and their staff

2) The General Counsel- final and independent authority which is under the Board and has to do investigation of charges and issuance of compliance.

3) The Regional Offices- are located in large cities and are supervised by the General Counsel

NLRB Authority is about the enterprises those affect on the commerce by their operations. There could be included to the commerce: “trade, traffic, transportation, or communication within the District of Columbia or any Territory of the United States; or between any State or Territory and any other State, Territory, or the District of Columbia; or between two points in the same State, but through any other State, Territory, the District of Columbia, or a foreign country”

Supervisors are actually excluded by the NLRB from participating in organizing activities and being a member of the bargaining unit because, he/she could have some interest in favor of employer so there might be inappropriate situations like: to cause another employee to be hired, rewarded, disciplined

5 0

3 years ago

Marriott Corporation now contains hotels and motels from the "budget" end of the consumer spectrum to the "premium" end with the

stepan [7]

Answer:

Two-way Stretch

Explanation:

Marriott Corporation now contains hotels and motels from the "budget" end of the consumer spectrum to the "premium" end with their JD Marriott flagship locations. This is an example of a firm that successfully performed a t<u>wo-way stretch</u> to reach more consumers and ventures that are more profitable.

Two way stretch: It is an expansion strategy of the company to introduce product within the same product line to cater different customer in the market. Company introduce new product to attract more customer as now they have premium product and low end product. Product are stretched both ways upward and downward. Example: Maruti, Titan, Marriot- Hotel & resorts, etc.

In the given case, Marriott Corporation now contains hotels and motels from the "budget" end of the consumer spectrum to the "premium" end with their JD Marriott flagship locations. Therefore, they are using two-way stretch strategy.

7 0

3 years ago

When working with the CAPM, which of the following factors can be determined with the most precision?a. The beta coefficient, bi

Evgen [1.6K]

Answer:

c. The expected rate of return on the market rM

Explanation:

The correct option is c. The expected rate of return on the market rM

* The expected market return is the return the investor would expect to receive from a broad stock market indicator such as the S&P 500 Index.

8 0

4 years ago

The regulations regarding both advertising and doing real estate business over the internet have been set forth in:

Minchanka [31]

<span>It is set forth if the business that is conducting by the individual is either a licensed professional or as someone who isn’t even licensed. It is because if a person is a licensed person, doing this field, it is likely that regulations are upheld as they do advertising and real estate business but if the person isn’t even licensed and starts to conduct these, regulations may not be upheld in both advertising and doing real estate as they are abiding rules such as having no license in doing this kind of field. That is why there way of conducting this manner depends on how regulations regarding advertising and real estate in the internet is set forth with such.</span>

7 0

4 years ago