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
Iteru [2.4K]
3 years ago
9

After a retiring from a successful business​ career, you would like to make a donation to your university. This donation will go

into the​ school’s endowment pool and the returns generated from the donation will support the salary of a new professor in the business school on a perpetual basis. The university expects to earn returns of​ 5.5% on its endowment pool. You may assume that any distributions to support the salary will be made annually.
Part A) You can make a donation today (t=0) in the amount of $2,500,000. The first cash flow distribution from your donation to cover the professor's salary will take place in one year (at t=1). Which of the following is closest to the annual salary payment that can be made as a result of your donation?

A. $2,500,000
B. $454,545
C. $100,000
D. $137,500

Part B) After further discussions, the university determines that the employment agreement with the new professor will call for annual salary increases of 2%. Given this new requirement, and assuming the first salary distribution will still occur one year from today, what is the starting salary (at t=1) that can be supported with your $2,500,000 donation?

A. $50,000
B. $187,500
C. $140,250
D. $87,500
Business
1 answer:
ICE Princess25 [194]3 years ago
3 0

Answer:

Part A) D. $137,500

Part B) C. $140,250

Explanation:

Part A) The computation of annual salary payment is shown below:-

Annual salary = Donation made × Interest rate

= $2,500,000 × 5.5%

= $137,500

So, for computing the annual salary we simply multiply the donation made with interest rate.

Part B) The computation of starting salary is shown below:-

Starting salary = Annual salary + Increased annual salary

= $137,500 + 2%

= $140,250

Therefore for computing the starting salary we simply added the annual salary with increased annual salary.

You might be interested in
In the short run:
prisoha [69]

Answer:

C)some inputs are fixed and some inputs are variable.

Explanation:

Usually, the fixed cost are usually fixed for a some levels of activity. However, as the level of activities increases, the fixed cost may also increase.

Variable cost on the other hand changes directly as the level of activities (say number of units produced) changes.

As such, in the short run, some inputs are fixed and some inputs are variable.

Option C is right.

8 0
3 years ago
The fares received by taxi drivers working for the City Taxi line are normally distributed with a mean of $12.50 and a standard
Lyrx [107]

Answer:

0.2308 or 23.08%

Explanation:

Mean (μ) = $12.50

Standard deviation (σ) = $3.25

Assuming a normal distribution, for any given fare X, the z-score is calculated as:

z = \frac{X-\mu }{\sigma}

For X = $15.00, the z-score is:

z = \frac{15.00-12.50 }{3.25}\\ z=0.7692

A z-score of 0.7692 corresponds to the 77.91-th percentile of a normal distribution. Therefore, the probability that a fare exceeds $15.00 is:

P(X>\$15.00) = 1-0.7692 = 0.2308

The probability that a specific fare will exceed $15.00 is 0.2308.

3 0
3 years ago
Which of the following are the names given to the two types of stock purchasers?
AlekseyPX

Answer: Common and Preferred Stock Purchasers

Explanation:

6 0
1 year ago
Pineapple Motor Company manufactures two types of speciality electric motors, a commercial motor and a residential motor, throug
Usimov [2.4K]

Answer:

a. Single Plant wide  Factory Overhead  Rate = $ 140 per machine hour

Overhead Rate of  Assembly Department $ 120 per machine hour

Overhead Rate of  Testing Department=    $ 150 per unit per machine hour.

Total Overhead per Unit    Commercial  $ 588      Residential $  462      

Explanation:

Pineapple Motor Company

Assembly Department  Factory Overhead 360,000

Testing Department  Factory Overhead 900,000

Total  Factory Overhead 1,260,000

Direct machine hours were estimated as follows:

Assembly Department 3,000 hours

Testing Department 6,000

Total 9,000 hours

                                      Commercial              Residential

Assembly Department       1.4 dmh                    1.1 dmh

Testing Department             2.8                           2.2

Total machine hours per unit 4.2 dmh           3.3 dmh

Single Plant wide  Factory Overhead  Rate = Total  Factory Overhead 1,260,000/Total 9,000 hours

a. Single Plant wide  Factory Overhead  Rate = $ 140 per machine hour

Overhead Allocated to Assembly Department = No of Hours * Rate

                      = 3000  * $ 140 = $ 420,000

Overhead Allocated to Testing Department = No of Hours * Rate

                      = 6000  * $ 140 = $ 840,000

b. Overhead Rate of  Assembly Department = Factory Overhead / Machine Hours= 360,000/3,000 hours = $ 120 per machine hour

                     

Overhead Rate of  Testing Department=   Factory Overhead / Machine Hours=  900,000/ 6000 hours=  $ 150 per unit per machine hour.

Overhead Allocated

                                         Commercial              Residential

Assembly Department       1.4 *120                   1.1 dmh *120

                                               168                          132

Testing Department             2.8*150                    2.2*150

<u>                                                420                             330                    </u>

<u>Total Overhead per Unit     $ 588                       $  462              </u>

c. ABC approach is better as it gives an estimate of the overhead per unit both for the Commercial and Residential department using the assembly and testing overheads rates separately. The single plant wide rate gives a mere estimate of the overall costs.

3 0
3 years ago
Ewing Marion Kauffman was an entrepreneur who invented a number of new drugs for the healthcare industry.
Bumek [7]

<u>TRUE</u>

<em>Ewing Marion Kauffman was an entrepreneur who invented a number of new drugs for the healthcare industry.</em>

<em><u></u></em>

4 0
3 years ago
Read 2 more answers
Other questions:
  • 1. You and your best friend are brilliant entrepreneurs who are considering opening your own business tutoring struggling colleg
    6·1 answer
  • ________ is the amount an employee earns before payroll withholding is performed.
    10·2 answers
  • Banking is a general term for what?
    12·2 answers
  • Hannah posts her résumé on the websites of several companies. Unfortunately, it is poorly formatted and contains several spellin
    6·1 answer
  • This is 1 question do not delete, mods. how am I supposed to separate a connect the lines thing without knowing the answers
    15·1 answer
  • The United States Postal Service (USPS) is in which type of market structure?
    6·1 answer
  • Nicholas omgnicholas omgnicholas omgnicholas omg
    11·2 answers
  • To determine if the bank's Web site is secure, look at the web site address.<br><br> True<br> False
    10·1 answer
  • Charitable donations, entertainment expenses, and
    12·1 answer
  • ritzer argues that the operating procedures perfected (but not originated) by have been duplicated in countless arenas from amus
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!