1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
evablogger [386]
3 years ago
12

A financial advisor offers you two investment opportunities. Both offer a rate of return of 11%. Investment A promises to pay yo

u $450 in 1 year, $650 in 2 years, and $850 in 3 years. Investment B promises to pay you $850 in 1 year, $x in 2 years, and $450 in 3 years. What must x be to make you indifferent between Investing A and B
Business
1 answer:
dsp733 years ago
3 0

Answer:

The value of x is 566.36

Explanation:

The value of x should be such that the present value of both Investments is the same when discounted at a rate of 11%. To calculate the present value, we use the following formula,

Present Value = CF 1 / (1+r)  +  CF 2 / (1+r)^2 + ... + CFn / (1+r)^n

Where,

  • CF represents Cash flow
  • r represents the discount rate

So, we equate both the present value of Investment A and B to calculate the value of x.

Present Value of A = Present Value of B

450/(1.11)  +  650/(1.11)^2  +  850/(1.11)^3 = 850/(1.11)  +  x/(1.11)^2  +  450/(1.11)^3

1554.472661  =  765.7657658  +  x/(1.11)^2  +  329.0361216

1554.472661  -  765.7657658  -  329.0361216  =  x/(1.11)^2

459.6707736 * (1.11)^2  =  x

x = 566.3603602 rounded off to 566.36

You might be interested in
Suppose you run a business that develops Web sites for e-commerce. You charge a flat fee of $2,700 to create the Web site. One o
shutvik [7]
Divide the two numbers
7 0
3 years ago
Company A charges $331.35 per week for a compact car with unlimited miles. Company B charges $175 per week plus $0.53 per mile,
Ymorist [56]

Answer:

so basically anyhting over 295 :)

Explanation:

331.35 = 175 + (0.53m)

156.35 = 0.53m

295 = m

3 0
3 years ago
____ involves completely disclosing to participants the goals and procedures involved in the study and obtaining their agreement
pychu [463]

Answer: The correct answer is OBTAINING INFORMED CONSENT.

Explanation: TIPS: In obtaining informed consent, participants are fully informed of the subject about his or her rights, the aim of the study, the procedures to be undertaken, the pros and cons of their participation, length of time of the study.

This is to ensure that the participation of subjects in the study is entirely voluntary and decision is not influenced.

4 0
3 years ago
what is the best strategy to avoid paying interest on your credit cards? who ever answers fast enough gets 30 points, so i'd hur
adoni [48]

Pay off your balance every month.

Explanation

Avoid paying interest on your credit card purchases by paying the full balance each billing cycle. Resist the temptation to spend more than you can pay for any given month, and you'll enjoy the benefits of using a credit card without interest charged

5 0
3 years ago
Read 2 more answers
One way the package software firm, intuit has approached the future and avoided disruptive innovation was to?
andrey2020 [161]

The package software company, intuit, bought mint.com as one strategy for anticipating the future and avoiding disruptive innovation.

A disruptive innovation is one that makes products and services simpler and more accessible to underserved or untapped markets.

Traditionally, established businesses focus on refining their goods and services for their lucrative clientele, usually ignoring the requirements and preferences of undeveloped markets. This lack of focus allows smaller businesses or newcomers the opportunity to reach this disregarded group with easier, more accessible choices.

On the other side, sustaining innovation refers to the practice of inventing to improve current goods and services for the client base already present, either in response to consumer or market demands.

To know more about disruptive innovation.

brainly.com/question/15703392

#SPJ4

3 0
1 year ago
Other questions:
  • Evan has received permission from his state to form a corporation for his startup, expecting his liability would be limited to t
    6·1 answer
  • Which of the following is true of work?
    5·1 answer
  • Accounts payable $36,500, Accounts receivable $46,500, Capital stock $100,000, Cash $46,000, Dividends $10,000, Goodwill $47,000
    15·1 answer
  • How much money does a teacher make
    10·1 answer
  • Identify the characteristics that have enabled Singapore to become one of the world’s most prosperous nations. Correct Answer(s)
    10·1 answer
  • Problems which deal with the direct distribution of products from supply locations to demand locations are called:____________.
    14·1 answer
  • How should public funds be allocated
    6·1 answer
  • Information technology (IT) has changed:_________. a. the various forms of utility that businesses require in order to succeed.
    5·1 answer
  • Click this link to view O*NET’s Work Activities section for Licensing Examiners and Inspectors. Note that common activities are
    8·2 answers
  • What is one way that critical thinking can help in career exploration?
    6·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!