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
Oxana [17]
3 years ago
5

You are considering two home security companies for your new house. The first company offers free installation and equipment, bu

t will charge you $401.00 per year forever. The second company charges $783.00 for installation, but will charge you $204.00 per year forever. Assume that payments are at the END of the year. Your personal interest rate is 5.00% per year, and you want to evaluate each proposal. What is the present value (PV) of the free installation?
Business
1 answer:
Vesnalui [34]3 years ago
5 0

Answer:

The second option is the cheapest.

Explanation:

Giving the following information:

The first company offers free installation and equipment, but will charge you $401.00 per year forever. The second company charges $783.00 for installation, but will charge you $204.00 per year forever. Assume that payments are at the END of the year. Your personal interest rate is 5.00% per year

To calculate the present value, we need to use the formula for a perpetual annuity:

PV= Cf/i

Cf= cash flow

i= interest rate

Option 1:

PV= 401/0.05= $8,020

Option 2:

PV= 204/0.05 + 783/1.05= $4,825.71

The second option is the cheapest.

You might be interested in
Which extended ERP component collects information used throughout an organization, organizes it, and applies analytical tools to
grin007 [14]

The extended ERP component that collects information throughout an organization and evaluates it is called <u>Business intelligence.</u>

<h3>What is business intelligence?</h3>

This is the component of Enterprise Resource Planning (ERP) that deals with collecting information from the entire organization.

This information would then be organized and prosessed after which it will then be used to guide the decisions of management.

Find out more on Enterprise resource planning (ERP) at brainly.com/question/14635097.

#SPJ1

8 0
2 years ago
Why does a high percentage of body fat increase the intoxication rate?
vodomira [7]
Answer:

There is less capacity for alcohol to extend out because it does not penetrate body fat. Intoxication is caused when body fat reacts with alcohol. The rate at which alcohol passes through the bloodstream is accelerated by body fat.
3 0
2 years ago
Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access th
IgorC [24]

Answer and Explanation:

the journal entry is given below:

Depletion Expense $1,358,500

         To Accumulated Depletion $1,358,500.

(Being depletion expense is recorded)

Here the depletion expense is debited as it increased the expense and credited the accumulated depreciation as it decreased the assets

Working note

Depletion expense is

= ($5,900,000 + $600,000) ÷ $2,000,000 × 418,000

= $1,358,500

8 0
2 years ago
Give any two merits and demerits of the partnership firm
fiasKO [112]

Answer:

w

Explanation:

w

8 0
2 years ago
Read 2 more answers
A purchase of a new issue of stock takes place Group of answer choices in the primary market. in the secondary and primary marke
mash [69]

Answer:

in the primary market and usually with the assistance of an investment banker.

Explanation:

Primary markets are ones where newly issues securities are sold. When companies seek to gain capital from investors, they issue securities that can be bought buy investors in exchange for capital.

Investment bankers are usually involved in the sale of securities in the primary markets. They obtain the securities on behalf of the investors.

Primary markets are also called new issues market

7 0
3 years ago
Other questions:
  • _____ work for a manufacturer and promote the manufacturer's products to other firms that buy the products from distributors or
    13·1 answer
  • A used-car dealer has a vehicle on the lot with a sticker price of $5999. if the dealer markup on used vehicles is 20%, how much
    7·2 answers
  • Under which of the following conditions is job dissatisfaction not likely to translate into turnover?a. Employees have high educ
    13·1 answer
  • A corporation issues 1,200,000 shares of stock at its beginning to shareholders. How many shares must a shareholder own to have
    8·2 answers
  • Allocating funds to promotion whereby the company determines its promotion objectives, outlines the tasks to accomplish these ob
    7·1 answer
  • Home value inc., max cart inc., and nice necessities inc. are three consumer-product retailing companies. their products consist
    8·1 answer
  • What is used to create an application that is helpful in designing business process models and also helpful in simulating, optim
    15·1 answer
  • All of the following are economic institutions EXCEPT
    5·1 answer
  • Samantha Rose Inc. made a $25,000 sale on account with the following terms: 1/15, n/30. If the company uses the net method to re
    7·1 answer
  • If there are 25 number 05 buyers what will be market demand​
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!