Answer: $11,620
Explanation:
A=P(1+r/n)^nt
A=$10,000(1+0.03/12)^12×5
A=$10,000(1+0.0025)^60
A=$10,000(1.0025)^60
A=$10,000(1.162)
A=$11,620
Note: A= Future value
P= principal
r=Interest rate
n= no.of time Interest is compounded
t= time money is invested.
Answer:
B) use the observed data to form a hypothesis about ice cream buying behavior.
Explanation:
The scientific method is a research method where the first step is recognizing and identifying the problem ⇒ relevant information is obtained ⇒ a hypothesis is formulated ⇒ the hypothesis is tested.
In order for a research (that uses the scientific method) to be valid, the researcher must be able to duplicate the research process and obtain the same or similar results.
Answer:
$9,500
Explanation:
The cash flow statement categories the company's transactions in a financial period into 3 groups; these are operating, investing and financing.
The net profit/loss, depreciation, changes in current assets (other than cash) and liabilities are considered as operating activities including income taxes.
The sale of assets, interest received, purchase of investments are examples of investing activities while the issuance of stocks, debt principal deduction (loan settlement), issuance of debt securities etc are examples of financing activities.
An increase in assets other than cash is an outflow while an increase in liabilities is an inflow. Depreciation and other non-cash expenses deducted in the income statements are added back while the non-cash income such gain on asset are deducted from net income.
Yowell's net cash flow from operating activities
= $44,000 - $10,500 - $24,000
= $9,500
Other transactions will be stated in the investing and financing sections of the cash flow statements
Answer:
a. Rf = 8%
Rm = 13%
Ke = 15%
β = ?
Ke = Rf + β(Rm – Rf)
15 = 8 + β(13 - 8)
15 = 8 + β(5)
15 - 8 = 5β
7 = 5β
β = 7/5
β = 1.4
b. Ke = Rf + β(Rm – Rf)
Ke = 4 + 1.7(15 - 4)
Ke = 4 + 1.7(11)
Ke = 4 + 18.7
Ke = 22.7%
Explanation:
In the first part of the question, there is need to calculate beta using capital asset pricing model. Risk-free rate, market return and required return on stock were given with the exception of beta. Thus, we will make beta the subject of the formula.
In the b part of the question, we need to calculate the required return on the stock given the risk-free rate, beta and market return. Therefore, we will apply the capital asset pricing model to calculate the required return.
A 25% discount rate for Project Lindbergh and 15% discount rate for Project Post are used.
<h3>How to depict the information?</h3>
The question pertains to capital budgeting and the formula used to calculate Present Value (PV) of future Cash flows is (CFt / (1+r)^t) and NPV is the sum of PV of all future cash flows from t=1 to t=8.
Also,, the probability of success is given for both projects. In the first project, it is 0.35 multiplied by 0.55 and in the second Project, it is 60%.
The NPV should be multiplied by the probability of success in order to get the expected NPV from both projects. The expected NPV of Project 2 is higher than Project 1.
Therefore, the management should go ahead with Project 2.
The missing part of the question:
Project Lindbergh utilizes a revolutionary technology to increase fuel utilization 15%. Project Lindbergh's system can be used on all airline aircraft, whether purchased from Wright or its competitors, and on Wright's next product generation. Project Post utilizes an existing technology that promises to increase fuel utilization 5%. Project Post's system can be used on Wright aircraft only. please assume a 25% discount rate for Project Lindbergh and 15% discount rate for Project Post.
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