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nasty-shy [4]
3 years ago
14

A store manager must decide how many rug cleaners to rent to customers. The manager estimates that the first would yield $200 a

year, the second $150, the third $75, and the fourth $50. If the interest rate is 12 percent and each rug cleaner costs $500/yr (all costs included), including replacement cost, how many should the manager rent?
Business
1 answer:
Harrizon [31]3 years ago
5 0

Answer:

The store manager must decide to buy 3

Explanation:

Given that:

  • The first:  $200 a year
  • The second $150
  • The third $75,
  • The fourth $50
  • Interest rate is 12 percent
  • Investment: $500

As we know that the rate of return will be: Income / Investment

So the rate of return of:

  • The first:  $200 / $500 = 0.4 = 40%
  • The second $150 / $500 = 0,3 = 30%
  • The third $75 / $500 = 0.15 = 15%
  • The fourth $50 / $500 = 0.1 = 10%

Only three rug cleaners have the rate of return greater than the interest rate so the store manager must decide to buy 3

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Which of the following statements is more likely if cash and marketable securities increase by $5,000 during a period in which c
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Answer:

C) Debt increases by more than cash dividends paid

Explanation:

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3 years ago
Cold Ice has a profit margin of 8.3 percent and a payout ratio of 42 percent. The firm has annual sales of $386,400, current lia
erastova [34]

Answer:

The internal growth rate is 4.36%

Explanation:

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net working capital = current assets – current liabilities

current assets – 37200 = 16700

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ROA = 53,900/445400

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b = 1 - 48% = 0.52

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7 0
3 years ago
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Answer:

a) I will pick the shares and sell them ,as this will yield a better return 6,338 to 5,000

b) I will consider:

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