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VLD [36.1K]
3 years ago
10

You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your compan

y and spend time on the beaches of Hawaii. A potential buyer is interested in your company, but he does not have the necessary capital to pay you a lump sum. Instead, he has offered $800,000 today and annuity payments for the balance. The first payment will be for $250,000 in three months. The payments will increase at 1.6 percent per quarter and a total of 20 quarterly payments will be made. If you require an EAR of 11 percent, how much are you being offered for your company? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
VikaD [51]3 years ago
5 0

Answer:

$5,225,417

Explanation:

first payment 800000

1 quarter         250000

2 quarters 254000

3 quarters 258064

4 quarters 262193

5 quarters 266388

6 quarters 270650

7 quarters 274981

8 quarters 279380

9 quarters 283851

10 quarters 288392

11 quarters 293006

12 quarters 297694

13 quarters 302458

14 quarters 307297

15 quarters 312214

16 quarters 317209

17 quarters 322284

18 quarters 327441

19 quarters 332680

20 quarters 338003

11% = (1 + i/4)⁴

i = 0.106

quarterly interest = 2.65%

Now we need to determine the present value of this  annuity and our discount rate is 2.65%. I will use an excel spreadsheet to determine the present value of the 20 quarterly payments and then add the initial payment.

$4,425,417 + $800,000 = $5,225,417

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Whitepunk [10]

Answer: Positive ways; Barriers in connecting is slightly no more, Negative ways; Increase in fraud and cyber theft

Explanation:

The internet has changed the conduct and cordination of global business in many ways both positively and negatively. Considering the positive ways

Positive Ways: Barriers in connecting is slightly no more: connecting to one another has been made easy to do business recently, people in continents can carry out a transaction and a trade under minutes of interaction and get the goods and services exchanged among each other immediately.

Negative ways; Increase in fraud and cyber theft; despite the swift nature of doing business now, it has also Increased fraud as some people disguise themselves to be traders and businessmen just to collect people's money.

7 0
2 years ago
Market size and growth of the total U.S. beer market was estimated to be around $106 billion. The total economic impact of the b
RUDIKE [14]

Answer:false

Explanation:

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So if beer market is estimated to be $106 billion, the percentage is ($106/$21427.1)*100

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3 years ago
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Sonbull [250]

Answer:

The correct answer is letter "A": operating activities.

Explanation:

Operating Activities are the daily processes conducted by a company to generate income. They pertain to the company's core business activity such as sales and manufacturing and they provide most of the cash flow that determines whether a business is profitable.

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3 years ago
A land title search office has a staff of three, each working eight hours per day (for a total payroll cost of $480/day) and ove
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2 years ago
Read 2 more answers
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Monica [59]

Answer:

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Explanation:

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=90,000*(60,000/100,000

=54,000

Truck=$54,000

Trailer=90,000-54,000=$36,000

3 0
2 years ago
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