Solution :
Annual payment = ![$\$ 5000$](https://tex.z-dn.net/?f=%24%5C%24%205000%24)
1. The rate of interest annually = 12%
Present value ![$=\$5000 \times \text{PVA of} \ \$1(12\%, 5)$](https://tex.z-dn.net/?f=%24%3D%5C%245000%20%5Ctimes%20%5Ctext%7BPVA%20of%7D%20%5C%20%5C%241%2812%5C%25%2C%205%29%24)
![$=\$5000 \times 3.60478$](https://tex.z-dn.net/?f=%24%3D%5C%245000%20%5Ctimes%203.60478%24)
= $ 18,023.90
2. The rate of interest annually = 12%
Present value ![$=\$5000 \times \text{PVAD of} \ \$1(12\%, 5)$](https://tex.z-dn.net/?f=%24%3D%5C%245000%20%5Ctimes%20%5Ctext%7BPVAD%20of%7D%20%5C%20%5C%241%2812%5C%25%2C%205%29%24)
![$=\$5000 \times 4.03735$](https://tex.z-dn.net/?f=%24%3D%5C%245000%20%5Ctimes%204.03735%24)
= $ 20,186.75
3. The rate of interest annually = 12%
The rate of interest quarterly = 3%
Present value =
![$+\$5000 \times \text{PV of} \ \$1(3\%, 16) + \$5000 \times \text{PV of} \ \$1(3\%, 16)$](https://tex.z-dn.net/?f=%24%2B%5C%245000%20%5Ctimes%20%5Ctext%7BPV%20of%7D%20%5C%20%5C%241%283%5C%25%2C%2016%29%20%2B%20%5C%245000%20%5Ctimes%20%5Ctext%7BPV%20of%7D%20%5C%20%5C%241%283%5C%25%2C%2016%29%24)
![$= \$5000 \times 0.88849 + \$5000 \times 0.78941 + \$5000 \times 0.70138 + \$5000 \times 0.62317 + \$5000 \times 0.55368$](https://tex.z-dn.net/?f=%24%3D%20%5C%245000%20%5Ctimes%200.88849%20%2B%20%5C%245000%20%5Ctimes%200.78941%20%2B%20%5C%245000%20%5Ctimes%200.70138%20%2B%20%5C%245000%20%5Ctimes%200.62317%20%2B%20%5C%245000%20%5Ctimes%200.55368%24)
![$=\$ 17,780.65$](https://tex.z-dn.net/?f=%24%3D%5C%24%2017%2C780.65%24)
Answer:
The correct answer is option b.
Explanation:
Mathew bakes and sells apple pies. Apple here is used as an input. If the price of apple increases, it means the cost of producing apple pies is increasing as well.
At the given cost the firm will be able to produce fewer apple pies. This will cause a reduction in the supply of apple pies. Consequently, the supply curve will shift to the left.
Answer:
Net loss = (6,700)
Explanation:
According to the scenario, computation of the given data are as follow:-
Income Statement
Particular Amount ($)
Revenue from Service 62,100
Revenue from Rent 8,500
Less-Salaries and wages expenses (50,700)
Less-Utilities expenses (22,600)
Less-Depreciation expenses (4,000)
Net loss (6,700)
<span>One result of the global economy is that trade
between the United States and other countries has decreased. </span>
Answer:
The intrinsic value of a share today is $16.87
Explanation:
Intrinsic Value of the share is calculated as below.
Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is calculated by calculating present value of future dividend payment.
Value of Share = Dividend / (Rate of return - Growth rate)
placing values in the formula
Value of share = $2 / (14% - 6%) = $25
$25 is the value of share after 3 year, to calculate today's value we have to discount it as below
Today's value of share = $25 x ( 1 + 14% )^-3 = $16.87