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
Alex_Xolod [135]
3 years ago
15

You are offered a chance to buy an asset for $200,500 that is expected to produce cash flows of $100,000 at the end of Year 1, $

42,000 at the end of Year 2, $52,850 at the end of Year 3, and $43,250 at the end of Year 4. What rate of return (IRR) would you earn if you bought this asset?
Please solve without Excel and show formulas used!
Business
1 answer:
Lapatulllka [165]3 years ago
3 0

Answer:

What rate of return (IRR) would you earn if you bought this asset?

8,48%

Explanation:

To find the IRR it's necessary to know which is the discount rate that applied to the cash flow of the assets gives a value that compensate the investment of $200,500.

Year 1   $100.000  / (1+0,0848)^1    =  $92.182    

Year 2   $100.000  / (1+0,0848)^2  =  $35.690  

Year 3   $100.000  / (1+0,0848)^3  =   $41.398  

Year 4   $100.000  / (1+0,0848)^4  =   $31.230  

Total Present Value of Cash  Flow=

$92.182  + $35.690 + $41.398 + $31.230 =  $200,500

There is no way to find the IRR without Excel, the only way is to try with different rates in the current cash flow formula.

You might be interested in
On December 31, 2017, Beta Company had 320,000 shares of common stock issued and outstanding. Beta issued a 4% stock dividend on
rosijanka [135]

Answer:

The answer is 324,050 shares

Explanation:

Stock dividends adds to the total number of shares outstanding while treasury stock(buy-back) reduces the total number of outstanding shares.

Beta issued a stock dividend of 4percent. Meaning the outstanding shares will increase by 4percent.

1.04 x 320,000 shares

=332,800 shares is the total number of outstanding shares before treasury stock.

Treasury stock issued on September 30, 2018. This means we have 3months(October 1 - December 31st, 2018).

So we have 3/12 x 35,000 shares

= 8,750 shares

Therefore, the appropriate number of shares to be used in the basic earnings per share computation for 2018:

=332,000 shares - 8,750 shares

= 324,050 shares

6 0
3 years ago
What effects did the Embargo Act of 1807 have on American industry? increased international competition forced U.S. to become mo
Anettt [7]

Answer:

forced U.S. to become more self-reliant

Explanation:

The 1807 Embargo Act in the short run resulted in very serious negative effects, but in the long run it helped the American economy to be more self-reliant.

Some of the negative effects on the short run include:

-agricultural products' prices and earnings decreased

-shipping-related industries were devastated

-existing markets were wrecked

-unemployment increased

-smuggling was widely endorsed by the public

-prices of domestic shipping increased

-imports and exports decreased

As a very positive effect, specially on the long run, it increased reliance on domestic manufacturing .

4 0
2 years ago
Read 2 more answers
1. Which of the following is an economic activity?
galina1969 [7]

Check this attachment

3 0
3 years ago
Read 2 more answers
If you take out a loan, which two things do your loan payments go toward?
Fofino [41]

Answer:

D. Principal and interest

7 0
2 years ago
Xpo Center Inc. and Festival Music LLC have an executory contract. They agree to rescind it and simultaneously enter into a new
NeX [460]

An executory agreement exists between Festival Music LLC and Expo Center Inc. They consent to cancel it and sign a new agreement at the same time. The new contract will probably be invalid if the earlier one was subject to a preceding responsibility.

The promise may be prevented from contesting the legality of the contract if the promisee can prove that they properly relied on the promise. Under the law of fraud, agreements that are made in writing and include the signatures of all parties are regarded as valid.

The majority of nations have laws that forbid minors under the age of 18 from signing legally binding contracts. A minor who enters into a contractual contract has the legal right to choose whether or not to abide by its conditions. There are, however, a disproportionately large number of severe cases.

To learn more about agreement

brainly.com/question/24225827

#SPJ4

6 0
1 year ago
Other questions:
  • Accounts receivable arising from sales to customers amounted to $80,000 and $70,000 at the beginning and end of the year, respec
    13·1 answer
  • Answer the question on the basis of the following information. Assume that if the interest rate that businesses must pay to borr
    13·1 answer
  • If the money supply is growing at a rate of 3 percent per​ year, real GDP​ (real output) is growing at a rate of 3 percent per​
    10·1 answer
  • Costello Corporation reported pretax book income of $500,900. During the current year, the reserve for bad debts increased by $6
    9·1 answer
  • Which of the following is the last step in creating a budget?
    8·2 answers
  • ABC Lumber spent $1,000 cutting down a tree. The result was 40 unfinished logs that sell for $20 each and 100 bags of sawdust th
    15·1 answer
  • What is the crown on the ambitious rank?
    6·2 answers
  • On the end-of-period spreadsheet, Supplies has a balance of $2,000 in the Unadjusted Trial Balance Debit column and an adjustmen
    5·1 answer
  • A public relations specialist earns $41,500 salary each year. He/she wants to spend no more than three times his/her salary on a
    12·1 answer
  • Eric and Chris run a non-regulated natural monopoly producing electricity for a small town. The barrier most likely preventing o
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!