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Arlecino [84]
3 years ago
14

You have an investment that in today's dollars returns 12% of your investment in year 1, 18% in year 2, 11% in year 3, and the r

emainder in year 4. Rounded to two places, what is the Duration of this investment
Business
1 answer:
tankabanditka [31]3 years ago
4 0

Answer:

The duration of this investment will be  14,005‬ years

Explanation:

Duration of investment= Sum of ( Percentage* TIme)

=( 1 x 12%) + (2 x 18%) + (3 x 11%) + (4 x 59%)

= 12+36+33+13,924‬

=14,005‬ years

You might be interested in
Tristan transfers property with a tax basis of $1,245 and a fair market value of $1,750 to a corporation in exchange for stock w
Bas_tet [7]

Answer: $1644

Explanation:

The corporation's tax basis will be the addition of the tax basis of Tristan and the gain that is recognized on the exchange by Tristan.

Gain realized = 1750 - 1245 = 505

Boot received = 399

The gain recognized on the exchange will the value that's lower between the gain realized which is $505 and the boot received which is $399. Therefore, gain recognized = $399.

The corporation's tax basis will then be:

= Tristan Tax basis + Gain recognized

= 1245 + 399

= 1644

6 0
3 years ago
Marko, Inc., is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $4,800, $9,800, and $
Harrizon [31]

Answer:

$23,977.29

Explanation:

In order to determine how much Marko would be willing to pay, we have to calculate the present value of the ABC Co.

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator:

Cash flow in year 1 =$4,800

Cash flow in year 2 = $9,800

Cash flow in year 3 = $16,000

I = 11%

Present value = $23,977.29

To find the PV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

7 0
3 years ago
A proposed new investment has projected sales of $850,000. Variable costs are 60 percent of sales, and fixed costs are $174,000;
777dan777 [17]

Answer:

  • <u>63,700</u>

Explanation:

Sales:                                                 850,000

Variable Cost: (850,000*60%) =      <u>510,000</u>

Contribution Margin = 850k-510k= <em>340,000</em>

Fixed cost =                                       174,000

Depreciation =                                    <u>75,000</u>

Earnings Before Taxes =                    <em>91,000</em>

Taxes (30%) =                                    <u>  (27,300)</u>

<h3>Net Income                                 <u>63,700</u></h3>

3 0
2 years ago
Identify three types of business or professional organizations?
arlik [135]

merchandising business

hybrid business

manufacturing business

5 0
3 years ago
How is having a security system for your home a risk management strategy?.
Dafna1 [17]

Answer:

because people will be listening in on your convo

8 0
2 years ago
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