Answer:
PV= $2,749,494
Explanation:
Giving the following information:
Cash flow= $200,000
Number of periods= 25
Interest rate= 5.25%
<u>First, we need to calculate the future value using the following formula:</u>
FV= {A*[(1+i)^n-1]}/i
A= annual cash flow
FV= {200,000* [(1.0525^25) - 1]} / 0.0525
FV= $9,881,102.14
<u>Now, the present value:</u>
PV= FV/(1+i)^n
PV= 9,881,102.14 / (1.0525^25)
PV= $2,749,494
Answer: C
Explanation:
Wealth is the gradual gathering of profits, assets or income over a period of time. It is the gradual increase in ones assets over a sustained period.
Wealth creating transactions can be found both in contract enforcement and private property rights. The prosperity and economic development of a country can be attributed to the respect accorded to its citizens property rights.
Property rights gives room for entrepreneurship which can eventually lead to wealth accumulation. Contract enforcement also generate wealth for individuals.
Answer:
$16,100
Explanation:
Add the total manufacturing costs for the year to determine the cost of goods manufactured during the current year. Also remember to account for change in work in process inventory.
The devision agrees a transfer price between themselves. This price may not reflect opportunity cost by producing and selling products. Reflects bargaining prowess of individual mangers.
Coupon rate is the yearly interest earned by a loan and it can be calculated with
where i is the annual interest and p is the par value of the bond or the initial loan amount.
For this particular case, since the semiannual payment is $28.50, then the annual payment is 2 x 28.50 = $57.00.
Thus, we have
From this, the coupon rate is 0.057 x 100% = 5.7%.
Answer: 5.7%
