Nark is a SECONDARY consumer when he eats a hamburger. A secondary consumer is basically an organism that feeds on primary consumers. (The cow in this case) :)
Answer:
First Offer
Present value = $60,000
Second Offer
PV = Down payment + A<u>(1 -(1 + r/m)</u>-nm
r/m
PV = $10,000 + $6,000(<u>1- (1+ 0.06/2</u>))-5x2
0.06/2
PV = $10,000 + $6,000(<u>1 - (1 + 0.03</u>))-10
0.03
PV = $10,000 + 6,000<u>(1 - (1.03)</u>)-10
0.03
PV = $10,000 + 6,000(8.5302)
PV = $61,181
The difference between the two present values
= $61,181 - $60,000
= $1,181
Explanation:
The present value of the cash payment is $60,000. The present value of the second offer is the down payment plus the present value of semi-annual payments. We need to use the present value of annuity formula so as to determine the present value of semi-annual payments. Then. we will deduct the present value of the first offer from the present value of the second offer in order to obtain difference in present values.
Answer: No, because the NPV of the project is negative.
Explanation:
First calculate the present value of this project's cashflows.
As it is in perpetuity, the present value is;
= Annual Cashflow/ Discount rate
= 7,500,000/0.15
= $50,000,000
NPV = Present Value of Cashflow - Investment
= 50,000,000 - 50,000,000
= $0
We discounted using the company's WACC but this project is said to be in an industry that has greater risk than Unitron's other projects.
This means that the relevant rate will be higher than 15% and when NPV is computed with anything higher than 15% for this project, the NPV will be negative because 15% is where it is at $0.
This project should not be accepted because it will have a negative NPV.
The correct answer is this one: "how much private-label sales added to the company's pretax profits, assuming that the company's margins on branded Footwear were sufficient to cover all administrative expenses and all interest costs," that is how <span>the sizes of a company's margins over direct costs should be viewed as.</span>
