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Strike441 [17]
3 years ago
15

Your friend is looking for investors in a risky business venture. To convince you to participate, she is offering you a 17% rate

of return in your investment. How much should you be willing to invest your friend s company, if she believes that she will be able to pay you the following amounts: $1000 at the end of the first year, $4000 at the end of the second year, and $5000 at the end of years 3, 4, and 5.
Business
2 answers:
telo118 [61]3 years ago
4 0

Answer:

B - $13,556.82

Explanation:

Amount to be invested is equal to the present value of future inflows

Present value = future value/(1+Interest rate)^Number of years

The actual amount at the end of the first year should be $3000 if there is an answer in the options

The amount at the end of the second year is $4000

The amount at the end of the third, fourth and fifth year is $5000

Hence, amount to be invested = 3000/(1.17) + 4000/(1.17)^2 + 5000/(1.17)^3 + 5000/(1.17)^4 + 5000/(1.17)^5

= $13,556.82

Hence, the answer is $13,556.82

lozanna [386]3 years ago
4 0

Answer:

The answer is $11,847

Explanation:

Amount to be invested is equal to the present value of future inflows

Present value = future value/(1+Interest rate)^Number of years

Hence, amount to be invested = 1000/(1.17) + 4000/(1.17)^2 + 5000/(1.17)^3 + 5000/(1.17)^4 + 5000/(1.17)^5

= $11,847.

Hence, the answer is $11,847..

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snow_tiger [21]

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Esmeralda was given the chance to audition for the Performing Arts High School which she succeeded in. She then moved to New York and attended School, studying drama and dance.

Esmeralda Santiago wrote her autobiography "When I Was Puerto Rican" which narrates her and her family's life moving from Puerto Rico to America. The book also follows the Puerto Rican girl through the many obstacles that she had to endure and overcome to change her life.

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8 0
2 years ago
"a typical group is selected from the population, and a random sample is taken from within the group. this is an example of" ___
torisob [31]
If the people conducting said experiment specifically wanted to select a random group of typical people it could be considered stratified. if they specified that they wanted any group of typical people then it would be simple random. Just looking at the supplied info, i'm pretty sure it's simple random.
3 0
3 years ago
Benny Company budgeted 610 pounds of direct materials costing​ $18.00 per pound to make​ 8,000 units of product. The company act
docker41 [41]

Answer:

-$720 unfavorable

Explanation:

The computation of the material quantity variance is shown below:

= Standard Price × (Standard Quantity - Actual Quantity)

= $18 per pound × (610 pounds - 650 pounds)

= $18 per pound × -40 pounds

= -$720 unfavorable

Simply we take the difference between the standard quantity and the actual quantity and then multiply it by the standard price so that the correct value can come

6 0
3 years ago
List the three generations in the workplace today, and provide at least two characteristics of each generation that affect their
kow [346]

Answer:

(1) Baby boomers born between 1946 to 1964.

Characteristics: They are optimistic and self focused.

(2) Generalization X born between the 1965-1980

Characteristics: They are independent and are knowns as the pioneers of Technological systems.

(3) Generation Y born between 1981 to 1997.

Characteristics: They are known to be Tech dependent and self expressive.

SIMILARITIES

All these groups are similar in terms of their value for independence in the work place, visionary and coaching style of leadership.

DIFFERENCE

Baby boomer created more competition in the work place,they value work over family and are less supportive.

Generation Xers are self reliant,self sufficient and most entrepreneur.

Generation Yers known as digital natives, grew up with the internet.

Explanation: In the work place their are different categories of persons based on their age, this categorization helps organisations to understand how to manage and regulate Relationships between the leaders and the other members of the Organisation.

Understanding the various generations available in a work place is vital to motivation and success of the business entity.

8 0
3 years ago
Westbrook's Painting Co. plans to issue a $1,000 par value, 20-year noncallable bond with a 7.00% annual coupon, paid semiannual
xeze [42]

Answer:

The component cost of debt used to calculate the WACC will change by <u>0.70%</u> if the new tax rate was adopted.

Explanation:

This can be calculated using the formula for calculating the component cost of debt used to calculate the WACC as follows:

CD = WD * PCD * (1 - t) ........................ (1)

Where;

CD = Component of cost of debt in WACC

WD = Weight of debt

PCD = Pretax cost of debt

t = tax rate

Note: Since information is provided for only the 20-year noncallable bond in the question, we assume that WD is 100% for simplicity purpose.

We can therefore proceed as follows:

<u>a. CD When tax rate is 25%</u>

Based on equation (1) and the assumption in the note, we have:

CD when t is 25% = Component of cost of debt in WACC = ?

WD = Weight of debt = 100%

PCD = Pretax cost of debt = 7%

t = tax rate = 25%

Substituting into equation (1), we have:

CD when t is 25% = 100% * 7% * (1 - 25%) = 5.25%

<u>b. CD When tax rate is 15%</u>

Based on equation (1) and the assumption in the note, we have:

CD when t is 15% = Component of cost of debt in WACC = ?

WD = Weight of debt = 100%

PCD = Pretax cost of debt = 7%

t = tax rate = 15%

Substituting into equation (1), we have:

CD when t is 15% = 100% * 7% * (1 - 15%) = 5.95%

c. the WACC change if the new tax rate was adopted

Change in WACC = CD when t is 15% - CD when t is 25% = 5.95% - 5.25% = 0.70%

Therefore, the component cost of debt used to calculate the WACC will change by <u>0.70%</u> if the new tax rate was adopted.

4 0
3 years ago
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