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7nadin3 [17]
3 years ago
8

ignoring differences in the useful lives of investments when evaluating capital expenditure alternatives can distort present val

ue analysis.
Business
1 answer:
vodka [1.7K]3 years ago
6 0

Answer:

Yes, it does.

Explanation:

It definitely impacts the present value analysis. If we are evaluating two proposals and we ignore the useful lives of the investments, then

  • The present values of the investment proposals will be inaccurate.
  • The cash flows might be inaccurate.
  • The discount factor to be used will also be inaccurate.
  • The overall results will be misleading.
  • The tax credits and balancing allowances and charges will also be inaccurate.
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Indicate whether each of the following transactions represents an increase in net exports, a decrease in net exports, an increas
iris [78.8K]

Answer:

(a). A worker at a Sony plant in Japan buys some Georgia peaches from an American farmer.

-<u> Increase in exports while no change in imports</u>.

(b). The Sony pension fund buys a bond from the U.S. Treasury.

- <u>Decrease in a net outflow of capital. Thus, it would be considered as a negative inflow/outflow</u>.

(c). An American investor buys a controlling share in a South Korean electronics firm.

- <u>Increase in Net Capital outflow for the U.S</u>.

Explanation:

Exports are described as the selling of domestic goods to a foreign country while Imports are characterized as the process of bringing in foreign goods to the domestic country. And Capital outflow is defined as the exact flow of funds from domestic to foreign and foreign to the domestic country.

In the first case, the purchase reflects a rise in exports as the domestic product is sold to the foreign country. In the second situation, the net outflow of the capital would decreases as it demonstrates a foreign purchase of a domestic asset. In the third example, the American investors' purchase of a South Korean firm demonstrates a domestic purchase of a foreign asset and thus, the net capital outflow would rise.

7 0
3 years ago
The first step in rational decision-making is to Group of answer choices choose a person who could evaluate the decision. choose
mr Goodwill [35]

Answer:

identify the criteria that are important in making the decision.

Explanation:

Rational decision-making is a step-by-step method for choosing the best choice from the options and is carried out on the basis of reasoning, objectivity and examination of any factor before concluding

Therefore according to the above explanation the correct answer is to identify the criteria that are important in making the decision as it is the first step of rational decision making.

7 0
3 years ago
The upper management of barcelona restaurant group believes that success depends on employees who are self-starters and empowere
inysia [295]
This idea is most consistent with LAISSEZ FAIRE type of management in which the employees are allowed to use their ideas and creativity to flourish in their areas of specialization. The management takes a back seat role in the company and only offer guidance when needed.
3 0
3 years ago
Read 2 more answers
What is the opposite of a non convertible currency?
Cerrena [4.2K]
The opposite of a non convertible currency would be a convertible one

3 0
3 years ago
You are considering purchasing stock in Canyon Echo. You feel the company will increase its dividend at 3.6 percent indefinitely
VMariaS [17]

Answer:

$45.76

Explanation:

Next dividend = Dividend just paid * (1 + Dividend growth rate) = $3.71 * (1 + 0.036) = $3.84356

Using the formula for the dividend discount model, we can calculate he price per share of the company's stock as follows:

Stock price = Next dividend / (Required return - Dividend growth rate) = $3.84356 / (0.12 - 0.036) = $45.76

Therefore, the price per share of the company's stock is $45.76.

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3 years ago
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