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iris [78.8K]
3 years ago
15

Peter Lynchpin wants to sell you an investment contract that pays equal $22,500 amounts at the end of each of the next 20 years.

If you require an effective annual return of 8 percent on this investment, how much will you pay for the contract today?
Business
1 answer:
Effectus [21]3 years ago
7 0

Answer:

The amount to be paid for the contract today = $220,908.32

Explanation:

<em>The amount to be paid for the contract today will be equal to the present value of the annuity of $22,500 payable for 20 years discounted at a rate of 8% per annum.</em>

Present Value = A ×( 1 - (1+r)^(-n))/r

A- 22,500, r- rate of return - 8%, n -no of years 20 years

PV = 22,500 ×( 1-(1.08)^(-20) )/ 0.08

PV = 22,500 ×9.8181

PV = $220,908.32

The amount to be paid for the contract today = $220,908.32

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Explanation:

They can be used to measure different qualitative and quantitative resources of the sample been observed.

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3 years ago
The Freedom of Information Act is designed to
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Answer:<u><em>Option (b) is correct.</em></u>

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Glinda goes to the supermarket for her monthly grocery shopping. As she waits in the line at the cash register, she sees her fav
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Answer:

<em><u>Convenience products.</u></em>

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7 0
3 years ago
Charlie Chairs Inc., manufactures plastic moldings for car seats. Its costing system utilizes two cost categories, direct materi
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Answer:

Units transferred out = 760

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If we assume that all units are completed in the order of arrival i.e (FIFO), then the units transferred out is the sum of the opening inventory and the units started and completed in the period. The units started and completed in the period is referred to fully-worked.

Fully worked is computed as the units started in the period less the closing inventory .

Fully- worked = 800 - 240 = 560

The units transferred out = opening inventory + Fully-worked

                                          = 200 + 560 = 760

Units transferred out = 760

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6 0
3 years ago
Ocean Vessels, Inc., and Pacific Harbor Company enter into a contract for a sale of a boat. Ocean is a merchant who deals in goo
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Answer:

d.​regardless of what Ocean knew or could have discovered.

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The uniform commercial code are a set of rules that govern transactions involving sale of goods. One of such rules is the implied warranty of merchantability.

When goods are sold there is an implied warranty that the item will perform up to a particular level.

For example if one buys a television not is expected that the television will work. If it does not come on, implied warranty has been breached.

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3 years ago
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