Answer:
Caveat emptor is the correct answer.
Explanation:
Anticipatory business model is the business type where everything is pre-defined and Response based business model is the one which have reduced the forecasting by joint planning.
<h3>What are types of business models?</h3>
There are various kinds of business model, which business performs these days, it also depends upon the range of customers the business is dealing with. Some of the hem are-
- Product to service model. ...
Thus, both the business model concentrate on different things.
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Question:
Graded assignment(towards 15% Hw grade) Saved Help Save& Exit Submit Check my work Your landscaping company can lease a truck for $7,800 a year (paid at year-end) for 6 years. It can instead buy the truck for $38,000. The truck will be valueless after 6 years. The interest rate your company can earn on its funds is 7%. 10 points
What is the present value of the cost of leasing?
Answer:
Cost of lease = $37,179.01
Explanation:
Leasing is a finance arrangement where one party (the lessor) transfers the right to use an asset to another party (the leasse) in exchange for a rent.
The cost of a lease to the leasee is the present value of the future lease payment discounted at the cost of capital.
So using the present value of annuity formula, we can work out the cost of the lease arrangement as follow:
PV =A× (1- 1+r)^(-n)/r
PV- Present Value
r- interest rate
n- number of years
A- annual lease payment
PV -
A-7,800
r-7%
n-6
PV = 7,800× (1- (1.07)^(-6)/0.07 = 37,179.01
Present Value = $37,179.01
Cost of lease = $37,179.01
As interest rates rise, the prices of existing bonds will fall.
A fundamental principle of bond investing is that market interest rates and bond prices generally move in opposite directions. When market interest rates rise, prices of fixed-rate bonds fall. this phenomenon is known as interest rate risk.
Interest rates will always change, and no one can predict how they will change over time. Whether interest rates are rising or falling, it’s vital to consider your yield to maturity for any bond purchase and compare it with what you could get if you were to buy a new bond.
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Answer:
The Solow model basically states that as more rural and backward economies start to develop, they will use more intensively their cheap labor and savings for investment more than already developed nations, and convergence between rich and poor nations will eventually occur.
Explanation:
The Solow growth model is an exogenous model of growth that tries to examine the changes in the level of output in an economy as a result of some changes in the economy. The changing conditions are; population, rate of savings and technological advancement. The Solow model named after Robert Solow who was a Nobel-prize economist winner, formed the foundation for modern theories of economic growth. Solow's growth models has a variety of assumptions as shown;
1. Rate of population growth is constant
2. The proportion of savings in the economy is constant.
3. The same technology is utilized by all companies in the economy for production.
4. The capital accumulation equation forms a relationship between; Present capital stock, future capital stock, the rate of capital depreciation, and level of capital investment.
Solow's model implied that as more rural and backward economies start to develop, they will use more intensively their cheap labor and savings for investment more than already developed nations, and convergence between rich and poor nations will eventually occur.
