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amm1812
3 years ago
6

Del Monty will receive the following payments at the end of the next three years: $5,000, $8,000, and $10,000. Then from the end

of the 4th year through the end of the 10th year, he will receive an annuity of $11,000 per year. At a discount rate of 9 percent, what is the present value of all three future benefits
Business
1 answer:
agasfer [191]3 years ago
8 0

Answer:

Present value of all future benefits  = 19,042.58 + 55362.48 = $74,409.24

Explanation:

Given data:

Next three payment at end of next three year are $5000,$8000 and $ 10,000

Amount received at the end of 10th year $11,000 per year.

discount rate = 9%

Present cash of flow is calculated as

PV = \frac{ FV_1}{(1+r)^1} +\frac{ FV_2}{(1+r)^2} + \frac{ FV_3}{(1+r)^3}

PV = \frac{5000}{(1+0.09)^1} + \frac{8000}{(1+0.09)^1} + \frac{10,000}{(1+0.09)^1}

PV = $ 19,042.58

Present value of annuity = FV \times \frac{1 -(1+r)^{-n}}{r}

                                     = 11,000 \times \frac{1 -(1 +0.09)^{-7}}{0.09}

Present value of annuity = 55,362.48

Present value of all future benefits  = 19,042.58 + 55362.48 = $74,409.24

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Individuals who focus only on their own interests when making decisions are at the ________ stage of ethical development.
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3 years ago
A decrease in consumer spending can be expected to shift the aggregate demand curve ________.
xxMikexx [17]

Answer:

d. downward and cause output to decrease

Explanation:

As we know that

Aggregate demand = Consumption expenditure + government expenditure + net export

Where,

Net export = Export - import

In the case when there is a reduction in the consumer spending so it would be expected that the aggregate demand curve would be shifted to the downward due to which it results in reduction in output

Therefore the option d is correct

6 0
3 years ago
Expansionary monetary policy has people concerned about future inflation, which is causes an increase in expected inflation. thi
Dahasolnce [82]

Expansionary monetary policy has people concerned about future inflation, which is causes an increase in expected inflation. this will cause the Phillips Curve to shift right.

The trade-off between unemployment and inflation in an economy is represented by a Phillips curve. According to Keynesian macroeconomics, a fiscal expansion that moves the aggregate demand curve to the right can end a downturn.

The long-run Phillips curve will move to the right (because the natural rate of unemployment increases) if structural unemployment increases because people' job abilities become obsolete.

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4 0
2 years ago
Perggy's Bakes, a bakery in New Orleans that exclusively sells its confectionery products online, makes its products only when i
horrorfan [7]

Answer:

A)equilibrium price

Explanation:

From the question we are informed about Perggy's Bakes, a bakery in New Orleans that exclusively sells its confectionery products online, makes its products only when it receives an order. The bakery produces the products as per the order and delivers to the customer's homes. It does not produce any excess products. In the given scenario, the price associated with the demand and supply of the products at Perggy's Bakes reflects the equilibrium price. The equilibrium price can be reffered to as only price in which both desires of consumers and that of producers agree, this can be explained as a situation where by quantity demanded is been equal to quantity supplied. The theory stressed that movement of market tends toward this price, it can also be regarded as "market-clearing price"

6 0
3 years ago
Trumbull Corporation budgeted sales on account of $120,000 for July, $211,000 for August, and $198,000 for September. Experience
GrogVix [38]

Answer:

a. $169,800

Explanation:

As for the provided information we have,

Sales data, for each month

July              $120,000

August         $211,000

September   $198,000

Cash receipt budgeted for September shall be:

36% of sale of the month of July = $120,000 \times 36% = $43,200

60% of sale of the month of August = $211,000 \times 60% = $126,600

Thus, total expected amount = $169,800

Therefore, correct option is

a. $169,800

4 0
2 years ago
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