What is the present value of the following cash-flow stream if the interest rate is 5%? (Do not round intermediate calculations.
1 answer:
Answer:
present value = $785.21
Explanation:
given data
interest rate r = 5%
Year 1 Cash Flow C1 = $190
Year 2 Cash Flow C2 = $390
Year 3 Cash Flow C3 = $290
time t = 3 year
solution
we get here present value of cash-flow stream that is express as
present value = ......................1
put here value and we get
present value =
present value = $785.21
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Answer:
The total monthly cost C(x) incurred by Carlota in manufacturing x guitars/month is <u>C(x) = 0.004x^2 + 90x + 8,500</u>.
Explanation:
Given,
C '(x) = 0.008x + 90 ................................... (1)
To obtain the the total monthly cost C(x) incurred by Carlota in manufacturing x guitars/month, we obtain the integral of equation (1) as follows:
C(x) = (0.008 / 2) x^2 + 90x + F
C(x) = 0.004x^2 + 90x + F .......................... (2)
Where F is the constant.
Since total cost is the addition of the total cost and total variable cost, the F in equation (2) represents the total fixed cost per month.
Since the fixed costs incurred by Carlota are $8500/month, this implies that F = 8,500.
Substituting F = 8,500 into equation (2), we have:
C(x) = 0.004x^2 + 90x + 8,500 <-------------- Total cost per month
Therefore, the total monthly cost C(x) incurred by Carlota in manufacturing x guitars/month is <u>C(x) = 0.004x^2 + 90x + 8,500</u>.