Answer:
21%
Explanation:
The formula to compute the annual rate of return is shown below:
= Annual net income ÷ average investment
where,
Annual net income equal to
= Annual revenues - annual expense
= $122,610 - $72,000
= $50,610
And, the average investment would be
= (Initial investment + salvage value) ÷ 2
= ($471,000 + $11,000) ÷ 2
= $482,000 ÷ 2
= $241,000
Now put these values to the above formula
So, the rate would equal to
= $50,610 ÷ $241000
= 21%
Answer:
The horizon value is calculated by discounting the free cash flows beyond the horizon date and any tax savings at the WACC
Explanation:
Horizon value
This is simply known as the value of a security. It is regarded as present value usually at future point in time of all cash flows when we stable growth rate is anticipated forever. Its simply known also as present value of all free cash flows beyond the horizon date discounted back to the horizon date. It is also called the terminal value due to it being regarded as end of the explicit forecast period or the continuing value due to the fact that it is the value if operations continue to be used rather than be liquidated.
The growth in free cash flows is usually not constant so modification has to be made to the constant growth formula to find the value of free cash flows beyond the horizon date discounted back to the horizon Formula to calculate horizon value.
Mathematically;
HV = V option at time t =FCFt(1+g)
(WACC-g)
The formula for Terminal Value using the Gordon Growth method includes: Terminal Value = Final Year Free Cash Flow * (1 + Growth Rate) / (Discount Rate - Growth Rate)
Answer:
The correct answer is letter "C": product attributes that consumers consider the most important.
Explanation:
Meticulous consumers tend to search for the technical features of the products they are interested in so they can make comparisons to decide which product matches their needs better. This research is important for producers and retailers to find out <em>what product attributes consumers consider the most important.</em> That information help companies to determine what they should focus their production so the possibilities of consumers purchasing their goods increase.
First, I would prefer ATM transactions as this allows me to access cash is faster than over the counter transactions and it can be done any time of the day. Second, I would also prefer to use online banking because this is a very quick way to transfer money from my account to another's without having to queue up to deposit.