1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
aleksandrvk [35]
3 years ago
15

XYZ can buy a Monet for $8,200,000 today. She believes that the masterpiece can be sold in 9 years for $19,600,000. What is the

annual rate of return that XYZ expects to earn on this art investment? a. 139.02% (plus or minus .02 percentage points) b. 15.45% (plus or minus .02 percentage points) c. 10.17% (plus or minus .02 percentage points) d. 26.56% (plus or minus .02 percentage points) e. None of the above is within .02 percentage points of the correct answer
Business
1 answer:
myrzilka [38]3 years ago
4 0

Answer:

c. 10.17%

Explanation:

we can use the future value formula:

future value = present value x (1 + r)ⁿ

  • future value = $19,600,000
  • present value = $8,200,000
  • n = 9

$19,600,000 = $8,200,000 x (1 + r)⁹

$19,600,000 / $8,200,000 = (1 + r)⁹

(1 + r)⁹ = 2.390243902

⁹√(1 + r)⁹ = ⁹√2.390243902⁹√

1 + r = 1.101663943

r = 1.101663943 - 1 = 0.101663943 = 10.17%

You might be interested in
Which of the following tends to result in a decrease in the selling price of houses in an area? A. An increase in the population
juin [17]

Answer:

An increase in mortgage interest rates.- D.

7 0
3 years ago
Several years ago the Haverford Company sold a $1,000 par value bond that now has 25 years to maturity and an 8.00% annual coupo
kodGreya [7K]

Answer:

5.4%

Explanation:

Several years ago the Haverford Company sold a $1,000 par value bond that now has 25 years to maturity and an 8.00% annual coupon that is paid quarterly. The bond currently sells for $900.90, and the company’s tax rate is 40%. What is the component cost of debt for use in the WACC calculation

Face value of bond = coupon amount / interest rate

1000 = 80 / 8%

Therefore 900.9 = 80 / revised interest rate

multiply both sides by the 'revised interest rate

revised interest rate x 900.9 = 80

Hence, revised interest rate = 80  / 900.9 = 9%

Secondly if the company’s tax rate is 40%, the component cost of debt for use in the WACC calculation = kd (1 - t)

where:

kd = Cost of debt

t = tax rate

Therefore cost of debt for use in the WACC calculation = 9% (1-0.4) = 5.4%

4 0
3 years ago
A registered investment adviser often recommends real estate limited partnership investments to her wealthy clients. The RIA's p
Levart [38]

Answer:

B.Her actions are inconsistent with the advice being given to her clients and this must be disclosed

Explanation:

A registered investment adviser often recommends real estate limited partnership investments to her wealthy clients. The RIA's personal financial statement and income are consistent with those of her wealthy clients, yet she never buys limited partnership units for her personal account. Which statement is TRUE

A real estate limited partnership (RELP) is a group of investors who pool their financial resources to invest in property purchasing, development, or leasing. Under its limited partnership status, This form of partnership  has a general partner who bears full liability and limited partners who are predispose  only up to the amount they contribute

The registered investment adviser does not practice what she teaches. She might just be in the profession for the money. She might also understand the risk associated with the real estate limited partnership investments and hence  would want to be risk averse herself. she should let her clients know the nitty gritty of the partnership and put a disclaimer across to them

4 0
3 years ago
Normal and inferior goods are differently impacted by recessions. Examples include new cars versus fast food. The textbook examp
Darina [25.2K]

Answer:

research four other examples of inferior goods.

There are many examples of inferior goods. Inferior goods are al those goods whose demand rises in times of economic recession. Some examples are:

Cheap food substitutes like supermarket coffee, instantaneous ramen, or canned vegetables.

Cheap clothes.

Flights in low-cost airlines.

Consider the impact of economic recessions and expansions on normal goods.

Economic recessions impact normal goods negatively because people have less income to spend, and they opt to substitute the normal goods for inferior goods.

discuss how revenues of inferior goods producers are expected to be affected by economic recessions and expansions.

In economic recessions, revenues for producers of inferior goods are expected to rise because demand for inferior goods grows. However, because inferior goods are precisely cheaper, this does not necessarily mean that every inferior good producer will make a lot of money.

In economic expansions, revenues for producers of inferior goods will fall, because people, with more income, will flock to normal goods or even luxury goods.

5 0
3 years ago
Golf Guide sells imprinted clothing and accessories for golfers through a catalog. To find new customers, Golf Guide sends a sma
kherson [118]

Answer:

Cost per customer acquired = $51.67

Explanation:

Customer acquired per thousand pieces mailed = 1000*6% = 60

Total cost per thousand pieces mailed A    $3,100

Divide by Customers acquired  B                <u>   60     </u>

Cost per customer acquired A/B                <u>  $51.67</u>

7 0
3 years ago
Other questions:
  • As an employee of new hampshire industries, kathleen has an opportunity to invest pre-tax income in an employer-sponsored retire
    14·2 answers
  • Paul Inc. forecasts a capital budget of $725,000. The CFO wants to maintain a target capital structure of 45% debt and 55% equit
    12·1 answer
  • When there is excess demand for a product in a market, a. price must be above the equilibrium price. b. producers will reduce ou
    15·1 answer
  • The Haas Corp., a calendar year S corporation, has two equal shareholders. For the year ended December 31, year 6, Haas had net
    15·1 answer
  • In the United States, many local communities provide public libraries and parks. This is an example of a local government fullin
    6·2 answers
  • A______is a breakdown of a project into its various component parts with the
    12·1 answer
  • Suppose that you were trying to determine how much income was available for future monetary needs as well as for investment.
    9·1 answer
  • Brie buys a subscription to music provided by Concerto, an online streaming service. Before gaining access, Brie must agree to a
    6·2 answers
  • in preparing a statement of cash flows under the indirect method, an increase in accounts payable would be reported or included
    7·1 answer
  • Explain any 2 objectives of a multinational firm with regard to its compensation policies?
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!