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horsena [70]
3 years ago
11

Kristi Collmer and Ray Bergeron each received signing bonuses from their accounting firms today. Kristi received $5,000 immediat

ely. Ray will receive $1,500 at the end of each year for the next 4 years. Assuming a 10% interest rate, who got the better deal and by how much (in today’s dollars)?
Business
1 answer:
lesya [120]3 years ago
6 0

Answer:

Kriste receive a better deal by $242.2

Explanation:

First, we will compare the present value for a 4-years annuity of $1,500 at 10% discount rate. So we can compare both values at the same date.

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 1500

time 4 years

rate 10% --> 0.1

We plug the values into the formula and solve

1500 \times \frac{1-(1+0.1)^{-4} }{0.1} = PV\\

PV $4,754.80

This values is the equivalent of Ray deal. At the discount rate of 10% is the same receive 4,754.8 today or 1,500 over a 3 year period.

Kristi receive 5,000 today while Ray receive the equivalent of 4,757.8 today

We compare each one to determinate the difference:

Kriste 5,000 - Ray 4,757.8 = 242.2

Therefore, Kriste receive a better deal by $242.2

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Jones Corp. reported current assets of $196,000 and current liabilities of $138,500 on its most recent balance sheet. The curren
myrzilka [38]

Answer:

0.74

Explanation:

Jones corporation reported a current assets of $196,000

The current liabilities is $138,500

The current assets consists of $61,000 cash , account receivable= $42,100, inventory= $92,900

Therefore the quick ratio can be calculated as follows

= cash + account receivables

= $61,000 + $42,100

= $103,100

$103,100/$138,500

= 0.74

Hence the acid test(quick ) ratio is 0.74

4 0
3 years ago
One of the questions in the Pew Internet & American Life Project asked adults if they used the Internet at least occasionall
g100num [7]

Answer:

Explanation:

S/N   Age range       Adult Population       Population Internet Users

A       18   -    29                 478                                 454

B       30   -    49                833                                 741

C       50 and above         1644                                1058

             Total                     2955                               2253

a) Let E = Estimate proportion and A = Internet users

Hence, n(E) = 478 and n(A) = 454

∴ Probability of Internet users (18 - 29), P(A) = n(A)/n(E) = 454/478 = 0.9498 (94.98%)

b) n(E) = 833 and n(B) = 741

∴ Probability of Internet users (30 - 49), P(B) = n(A)/n(E) = 741/833 = 0.8896 (88.96%)

c) n(E) = 1644 and n(C) = 1058

∴ Probability of Internet users (50 and above), P(C) = n(C)/n(E) = 1058/1644 = 0.6436 (64.36%)

d) Let Et = Total estimate proportion

Hence, n(Et) = 2955 and n(A) = 454

∴ Probability of 18 - 29 age range using Internet overall Pt(A) = n(A)/n(Et) = 454/2955 = 0.1536 (15.36%)

4 0
4 years ago
Molly, a company mediator, had agreed to help Martin and Samir. The two men had been in constant disagreement ever since they be
SashulF [63]

Answer:

By taking into account differences in the Hispanic American community's cultural orientation, Samir is considering their __________ when determining the proposal approach.

b) subculture

Explanation:

The Hispanic American community's cultural orientation is a form of subculture.  While being an integral part of the American society, the Hispanic American community still maintains specific characteristics of the Hispanic culture in the U.S.A.  Since it is regarded as a group of people with differentiating cultural peculiarities from the general American culture, the Hispanic American subculture has developed its own norms and values based on its founding principles, and these are not applicable to the wider American society.

subculture is a group of people within a culture that differentiates itself from the parent culture to which it belongs, often maintaining some of its founding principles. Subcultures develop their own norms and values regarding cultural, political, and sexual matters

4 0
3 years ago
Compare the two terms increasing marginal returns and diminishing marginal returns describe
Darya [45]
Increasing marginal returns is the increase of output when there is an addition of variable input aside from the fixed input over a short period. Diminishing returns is the decrease of output when there is an incremental increase of one production factor while other factors remained constant. 

4 0
3 years ago
Which one of the following statements concerning interest rates is correct?a. Savers would prefer annual compounding over a mont
ryzh [129]

Answer:

The correct answer is letter "C": The effective annual rate equals the annual percentage rate when interest is compounded annually.

Explanation:

Interest Rate is the cost of borrowing money, expressed as a percentage of the loan amount. Interest rates are the primary yardsticks for measuring how much return lenders will get.

The effective annual interest rate is a way of restating the annual interest rate so that it takes into account the effects of compounding. Using the effective annual interest rate helps us understand how differently a loan or investment performs if it compounds annually, semiannually, monthly, or in any other time frame. If compounded annually, the effective interest rate equals the annual percentage rate.

8 0
3 years ago
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