Answer:
The payback period for this project is 2.43 years.
Explanation:
Elmer Sporting Goods is getting ready to produce a new line of golf clubs by investing $1.85 million.
The investment will result in additional cash flows of $525,000, $812,500, and 1,200,000 over the next three years.
The payback period is the time it takes to cover the investment to be covered by returns.
The investment cost remaining in the first year
= $1,850,000 - $525,000
= $1,325,000
The investment cost remaining in the second year
= $1,325,000 - $812,500
= $512,500
The third year payback
= 
= 0.427
The total payback period
= 2.43 years
Answer:
Explanation:
Before Street Runner Road Builders allows new employees to operate the heavy machinery it uses to build roads, employees are sent to a nearby classroom where they learn the safe and proper way to work with all of the tools and equipment they will use when they perform their jobs. Street Runner Road Builders is using a training technique known as Vestibule Training. Vestibule training was a type of job training developed since the industrial revolution era to teach workers their job as they have to be trained near their work area to perform their specif job or operations. vestibule training is often called near the job training to offer to learn something new.
Answer:
<em>The (minimum) annual interest rate should be at 7.28%</em>
Explanation:
<u>Compound Interest</u>
An investment consisting of a principal P, (or present value) earns interest on each period considering the previous period's amount including the interest earned (no withdrawals). This situation is defined as an investment in compound interest unlike simple interest, where each interest amount is withdrawn and the new principal is P again.
To find the future value (FV) of an investment with an interest annual rate i during n years is
If needed, we can solve the equation for i. Dividing by P:
Taking the nth-root:
![\displaystyle \sqrt[n]{\frac{FV}{P}} =1+i](https://tex.z-dn.net/?f=%5Cdisplaystyle%20%5Csqrt%5Bn%5D%7B%5Cfrac%7BFV%7D%7BP%7D%7D%20%3D1%2Bi)
Finally:
![\displaystyle i=\sqrt[n]{\frac{FV}{P}} -1](https://tex.z-dn.net/?f=%5Cdisplaystyle%20i%3D%5Csqrt%5Bn%5D%7B%5Cfrac%7BFV%7D%7BP%7D%7D%20-1)
The parents will retire in n=27 years and they currently have P=$360,000 as an initial investment that they want to become into their retirement funds. Let's calculate the needed interest rate:
![\displaystyle i=\sqrt[27]{\frac{2,400,000}{360,000}} -1](https://tex.z-dn.net/?f=%5Cdisplaystyle%20i%3D%5Csqrt%5B27%5D%7B%5Cfrac%7B2%2C400%2C000%7D%7B360%2C000%7D%7D%20-1)
The (minimum) annual interest rate should be at 7.28%
