Answer:
The correct answer is: feasible and efficient.
Explanation:
The production possibility curve or frontier shows the different bundles or combinations of two goods that be produced using the given resources and state of technology.
All the points on the production possibilities curve represent the combinations that are feasible and efficient.
The points below the curve show the points that are feasible but inefficient.
The points above the curve show the points that cannot be attained using the given level or resources and technology.
Answer: Option C
Explanation: The given question relates to the concept of time value of money which in simple words states that the value of money decreases over time. The value of a dollar today will be less than tomorrow.
Hence if a card holder gets grace period to pay the interest before the interest accrues than it means he actually gets to pay lower interest that he could have paid before.
Hence from the above we can conclude that the correct option is C.
Answer:
warranty expense 10,400 (260,000 x 4%)
warranty liablity 10,400
warranty liability 150
wages payable 50
inventory 100
Explanation:
we recognize the expected warranty expense at the moment of the sale.
Then expenses associate with the warranty will decrease the prevision "warranty liability"
The part used come from the company's inventory
and the wages for work on the product, will have to be paid.
<u>Note: </u>it could be cash directly instead of using wages payable account. But because there is no information about those wages being paid I assume are not.
Answer:
d. Choose Option B because it has a higher NPV
Explanation:
The computation is shown below:
For Option A:
Investment = $10 million
Present Value of cash flows = Cash flow ÷ Discounting rate
= $2 ÷ 10%
= $20 million
Now
NPV = $20 - $10
= $10 million
We know that
IRR is the rate at which the NPV will be zero
So, 2 ÷ r - 10 = 0
r = 20%
For Option B:
Investment = $50 million
Present Value of cash flows = $6.5 ÷ 10% = $65 million
NPV = $65 - $50 = $15 million
we know that
IRR is the rate at which the NPV will be zero
So, 6.5÷ r -50 = 0
r = 13%
Based on NPV, Option B should be selected as it contains higher NPV as compared to option A.
However, Based on IRR, Option A should be chosen as it contains higher IRR and a higher IRR represent a higher profit percentage