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3 years ago

You purchase a 30-year, zero-coupon bond for a price of $25. The bond will pay back $100 after

Business

1 answer:

Reil [10]3 years ago

6 0

Answer:

annual compounded return = 4.73 %

so correct option is D) 4.73%

Explanation:

given data

present value = $25

future value = $100

time = 30 year

to find out

annual compounded return

solution

we get here annual compounded return that is express as

annual compounded return = $(\frac{FV}{PR} )^{\frac{1}{t}} - 1$ ............1

here t is time period and FV is future value and PV is present value

so put here all value in equation 1 we get

annual compounded return = $(\frac{100}{25} )^{\frac{1}{30}} - 1$

annual compounded return = 0.047294

annual compounded return = 4.73 %

so correct option is D) 4.73%

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Current operating income for Bay Area Cycles Co. is $40,000. Selling price per unit is $100, the contribution margin ratio is 20

svlad2 [7]

Answer:

Instructions are below.

Explanation:

Giving the following information:

Operating income= $40,000.

Selling price per unit is $100

Contribution margin ratio= 0.20

Fixed expense is $160,000

First, we need to calculate the unitary variable cost. We can use the contribution margin ratio formula:

contribution margin ratio= (selling price - unitary variable cost) / selling price

0.2 = (100 - unitary variable cost) / 100

unitary variable cost= 80

Now, the contribution margin:

Contribution margin= 100 - 80= $20

Finally, the number of units being sold:

Total contribution margin= operating income + fixed costs

Total contribution margin= 40,000 + 160,000= 200,000

Unitary contribution margin= Total contribution margin/number of units

20= 200,000 / number of units

number of units= 200,000/20

number of units= 10,000 units

6 0

3 years ago

Folsom Advertising, Inc. is considering an investment in a new information system. The new system requires an investment of $1,8

sveticcg [70]

Answer:

Payback period=2 years 5 months

Payback period=3 years 8 months

Explanation:

The payback period is the estimated length of time in years it takes .

It is the number of years it takes the cash project to break-even

a) Payback period

Total cash flow for two years = 750× 2 = 1500.000

Balance of cash flow required to make up= 1800000- 1500,000 300,000

Payback period = 2 years + 300,000/750,000× 12 months= 2 years 5 months

Payback period=2 years 5 months

b) Payback period

Total cash flow for 3 years = 450,000 + $225,000 +600,000=1,275 ,000

Balance o cash required to make up 1800,000 = 1,800,000 -1275,000= 525,000

Pay back period = 3 years + 525,000/750,000× 12 months

= 3 years 8 months

Payback period=3 years 8 months

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3 years ago

ABC common stock just paid a dividend of $2.50 per share. The ABC dividend is expected to grow 20% per year for two years, and t

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Answer and Explanation:

Given that the dividend will grow at 20% for two years and then a constant 6% at third year

1st year dividend at 20%= $3

Present value of the dividend for the first year=PV factor at 15%(from table) = $2.61

2nd year dividend at 20% = $3.60

Present value of the dividend for the second year = PV factor at 15%(from table) $2.72

3rd year dividend at 6% growth rate =

$42.40

Present value of the dividend for the third year = PV factor at 15% = $32.06

Current price of the stock =$2.61+$2.72+$32.06

=$37.39

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3 years ago

Alco roofing company's beginning accounts receivable were $200,000 and ending accounts receivable were $270,000. during the peri

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Https://quizlet.com/129490981/chapter-7-practice-flash-cards/

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3 years ago

If Kindle e-readers and Nook e-readers are substitutes, a higher price for Nooks would result in a(n) ______.

lara31 [8.8K]

Answer: a) increase in the demand for Kindles.

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3 years ago