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
ozzi
3 years ago
9

You just won a prize that will pay you $800 today and $500 a year for the next three years. Which is the correct formula for com

puting the present value as of today at 6 percent?
a. PV = $500/1.06 + $500/1.062+ $500/1.063
b. PV = $800 PV $800/1.06$500/1.06+$500/1.06 $500/1.06
c. PV =$800+ $500/1.06 $500/1.06+ $500/1.061
d. PV = $800(1.06)+ $500 +$500/1.06 $500/1.06
Business
1 answer:
cupoosta [38]3 years ago
7 0

Answer:

Total PV= 800 + 500/1.06^1 + 500/1.06^2 + 500/1.06^3

Explanation:

Giving the following information:

Cash flows:

Cf0= $800

Cf1= $500

Cf2= $500

Cf3= $500

Discount rate= 6%

The $800 is received today, therefore, it is already its present value.

For the cash flow for the next three years, we need to use the following formula on each cash flow.

PV= FV/(1+i)^n

Total PV= 800 + 500/1.06 + 500/1.06^2 + 500/1.06^3

You might be interested in
According to the Federal Housing Finance Board, the mean price of a single-family home two years ago was $299,500. A real estate
Tems11 [23]

Answer: A.There is sufficient evidence to conclude that the mean price of a single-family home has increased from its level two years ago of $299,500

Explanation:

From the question, we are informed that according to the Federal Housing Finance Board, the mean price of a single-family home two years ago was $299,500 and that a real estate broker believes that due to recent credit crunch, the mean price has increased since then and the result is that the null hypothesis is not rejected.

The conclusion based on the results of the test is that since the null hypothesis has been rejected, it simply means that there are sufficient evidence that there has been an increase in the mean price since two years ago.

Therefore, option A is the correct answer.

3 0
3 years ago
The Fabricating Department started the current month with a beginning Work in Process inventory of $10,000. During the month, it
Natalka [10]

Answer:

$13,000

Explanation:

Calculation for what The ending balance of the Work in Process Inventory account for the Fabricating Department is:

Beginning Balance 10,000

Add Direct Materials 76,000

Add Direct Labor 24,000

Add Factory Overheads 12,000

(50% *24,000)

Less Work Transferred (109,000)

Ending Balance $13,000

Therefore The ending balance of the Work in Process Inventory account for the Fabricating Department is:$13,000

6 0
3 years ago
Gnomes R Us just paid a dividend of $1.90 per share. The company has a dividend payout ratio of 25 percent. If the PE ratio is 1
Verizon [17]

Answer:

Stock price=$128.44

Explanation:

Calculation for stock price

First step is to calculate for dividend payout ratio using this formula

Dividend payout ratio=Dividend payout/Earnings

Let plug in the formula

Earnings=($1.90/0.25)

Earnings=$7.6

Now let calculate for PE ratio using this formula

PE ratio=Stock price/EPS

Let plug in the formula

Stock price=$7.6*16.9times

Stock price=$128.44

Therefore Stock price will be $128.44

8 0
2 years ago
The price of fresh fish rose and the quantity sold fell. Other things remaining the same, which of the following is consistent w
Alenkinab [10]

Answer:

The correct answer is option D.

Explanation:

An increase in the cost of fishing will lead to a decrease in the supply of fishes. This happens because the suppliers will be able to supply less at the same cost.  

So the supply curve will move to the left. This leftward shift in the supply curve will cause the equilibrium price to increase and the equilibrium quantity to decrease.  

All the other options would have caused the equilibrium quantity to increase either through increased demand or increased supply.

4 0
3 years ago
What most likely will happen if the pie maker bakes a seventh pie?
Korvikt [17]

Answer:

The marginal cost will most likely increase to $2.00

4 0
3 years ago
Read 2 more answers
Other questions:
  • The before-tax income for Ivanhoe Co. for 2020 was $104,000 and $81,200 for 2021. However, the accountant noted that the followi
    14·1 answer
  • During a contractionary phase of the business cycle, which of the following most likely occurs?
    8·2 answers
  • Why do cultural universal exist
    14·1 answer
  • Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a cost of $210,000 and accumulated deprecia
    5·1 answer
  • Both the inventory conversion period and payables deferral period use the average daily COGS in their denominators, whereas the
    5·1 answer
  • g The contribution margin ratio of Donath Corporation's only product is 64%. The company's monthly fixed expense is $454,200 and
    12·1 answer
  • Arktec manufacturing must choose between the following two capacity options:
    10·1 answer
  • suppose the following two events occur in the domestic market for radiologists: a. some hospitals are outsourcing some radiology
    9·1 answer
  • When certain brands are exclusively targeted to certain demographic groups, that is part of this market
    14·1 answer
  • Assuming that all occupied blocks need to be moved, how long will it take to compact the memory
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!