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JulsSmile [24]
3 years ago
10

What is the present value of a perpetual stream of cash flows that pays ​$8 comma 0008,000 at the end of year one and the annual

cash flows grow at a rate of 44​% per year​ indefinitely, if the appropriate discount rate is 1515​%? What if the appropriate discount rate is 1313​%?
Business
1 answer:
andre [41]3 years ago
8 0

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Cash flows= $8,000

Grow at a rate of 4​% per year​ indefinitely.

We need to find the present value using the following formula:

Present Value= periodic payment/ (i - g)

i= interest rate

g= growth rate

A) Interest rate= 15%

PV= 8,000/ (0.15 - 0.04)= $72,727.27

B) i= 13%

PV= 8,000/ (0.13 - 0.04)= $88,889

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I would think it would be yes I think
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Designs by Candice is a graphic design studio specializing in logos and business stationery. Candice has just made a $69,300 inv
borishaifa [10]

Answer:

Designs by Candice

Her costs include:

Costs of materials, labor, overheads.  

Then in charging her customers she would include the profit target of $7,623 (representing 11% of her capital investment).

Explanation:

As a graphic design studio, Design by Candice would buy stationery and design materials, including 3D printers and other software.  Candice would also incur labor costs on those doing the design proper.  There are also manufacturing overheads, including rent, utilities, etc. and not to forget other indirect costs like selling and marketing and administrative expenses.

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3 years ago
Using the AS-AD and IS-LM models, show the effects of an increase in consumer confidence on the position of the AD, AS, IS, and
lora16 [44]

Answer: hello your question has some missing information below is the missing information

Suppose the economy begins with output equal to its natural level. Then there is an increase in consumer confidence and households attempt to consume more for a given level of disposable income.

answer :

Attached below

Explanation:

IS-LM modeling curves intersects and it also defines the value of r and Y where r ( rate of interest )  Y( output level )

The AS-AD modeling is in equilibrium where aggregate demand curve and short run and long run aggregate supply curves intersects each other defining P and Y

p ( price level ) , Y ( output level )

<em>Note : Increase in aggregate demand shifts IS outward , raises interest rate and output level</em>

6 0
3 years ago
You Just won a prize that will pay you $800 today and $500 a year for the next three years. Which is the correct formula for com
kow [346]

Answer:

The correct answer is PV = $800 + $500/1.06 + $500/1.062 + $500/1.06^3

Explanation:

Solution

Given that:

A price was wan by you today at =$800

For the next three years =$500 a year

Now

We compute for the present value of today at 6%

Thus

Present value (PV) = $800 + $500/1.06 + $500/1.062 + $500/1.063

Because $800 is receivable today, its present value is equal to $800,

So,

500 receivable after a year will be divided by 1.06

PV = $800 + $500/1.06 + $500/1.062 + $500/1.06^3

Therefore the right formula for computing the present value as of today at 6 percent is PV = $800 + $500/1.06 + $500/1.062 + $500/1.06^3

4 0
3 years ago
Maxim manufactures a cat food product called Green Health. Maxim currently has 10,000 bags of Green Health on hand. The variable
Fittoniya [83]

Answer:

Total gross profit  =$ <u>50,565 </u>

Explanation:

<em>Gross profit is the sales revenue less the cost of the goods sold. The cost of goods sold would include the variable cost of production, fixed cost and the further processing cost</em>

<em>                                                                                                    $</em>

Sales revenue (10,000×$8.15) + ( 3100 ×$6.15) =            100,565

Further processing cost                                                   (21,000)

Variable cost ( 10,000 ×$1.90)                                         (19,000)

Fixed cost                                                                         (<u>10,000)</u>

Gross profit                                                                       <u>50,565 </u>

5 0
3 years ago
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