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Marianna [84]
3 years ago
15

Net present value: Select one: is the best method of analyzing mutually exclusive projects. is less useful than the internal rat

e of return when comparing different-sized projects. s the easiest method of evaluation for nonfinancial managers. is the easiest method of evaluation for nonfinancial managers.
Business
1 answer:
Leto [7]3 years ago
3 0

Answer:

Is the best method of analyzing mutually exclusive projects.

Explanation:

Net present value is equal to the present value of all the future cash flows of a project, less the initial outlay of project.

Net present value analysis simply concluded about a project to be worth doing when it finds the present value of future cash flows greater than the initial investment and vice versa.

We just have to see which is higher, the present value of future cash flows or the initial investment.

It is assumed that an investment with a positive NPV will be profitable, and an investment with a negative NPV will result in a net loss.

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Radverb Inc. paid a dividend of $2.00 last year. The company expects to increase the dividend at a constant rate of 2% per year,
Nezavi [6.7K]

<u>Solution and Explanation:</u>

The given ke  = 0.08 , Ke = 8%

Now, the required return falls by half (by 50%)

Ke (revised) = 8 percent multiply with the 50 percent = 4%

The Price of Radvob’s stock = 2(1.02) / 0.04-0.02 =$102

Do= $2

G=2%

The given Current price = $34

Ke= required return = ?

The Current price = \mathrm{D}_{0}(1+\mathrm{G}) / \mathrm{K}_{\mathrm{e}}-0.02

Ke=0.08 , Ke=8%

Now, the required return falls by half(by 5%)

Ke (revised) = 8 percent multiply with 50 percent = 4%

7 0
4 years ago
The letter of transmittal and the statistical section are classified as
NARA [144]
The letter of transmittal and the statistical section are classified as Comprehensive Annual Financial Report (CAFR).
These are not included in the basic financial statement and required supplementary schedule.
CAFR comprises the financial report of any state, municipality or government entity.
3 0
4 years ago
Develop a realistic example in which you expect positive covariance​
AURORKA [14]

Answer:

Composure and time management

Explanation:

these are realistic goals that people can reach and will have a positive outcome (do you mind following)

3 0
3 years ago
You are evaluating a potential purchase of several light-duty trucks. The initial cost of the trucks will be $194,000. The truck
pantera1 [17]

The after-tax cash flow associated with the sale of equipment is $299,325.

<h3>What is an initial cost?</h3>
  • The initial cost is the typical cost of buying or producing the goods you have on hand.
<h3>What is an operating cost?</h3>
  • Operating costs, often known as operating costs, are the costs associated with running a company, or with running a machine, part, piece of equipment, or facility.
  • They represent the cost of the resources an organization uses just to stay in business.
<h3>What is cash flow?</h3>
  • The actual or fictitious movement of money is known as cash flow.
  • In finance and accounting, cash flow describes the capital inflows and outflows of particular economic units with the aim of achieving a particular goal within a predetermined window of time.
  • Making an accurate prediction of future cash flows is required in accounting in addition to measuring current cash flows.
<h3>Solution -</h3>

Revenue of 5 years = 155000 * 5 = 775000.

Operating cost of 5 years = 81000 * 5 = 405000.

Sale of equipment = 29100.

Net profit = 775000+29100 - 405000=399100.

Tax to be deducted at 25% = 99775.

Cash flow after tax 399100-99775=299325.

Therefore, the after-tax cash flow associated with the sale of equipment is $299,325.

Know more about Initial costs here:

brainly.com/question/14984116

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5 0
2 years ago
Your friends suggest that you take a 15-year mortgage, because a 30-year mortgage is too long and you will pay a lot of money on
dimaraw [331]

Answer and Explanation:

The computation is shown below:

As we know that

Monthly payment of a loan is given by

P =  L [r(1 + r)^n] ÷ [(1 + r)^n - 1]

where,  

P = Monthly payment = ?

r = Interst rate = 0.1 ÷ 12 = 0.00833

n = Term = 15 × 12 = 180

L =  Loan amount = 900000

Now

P = $900,000 [0.00833(1 + 0.00833)^180] ÷ [(1 + 0.00833)^180 - 1]

= $9671.4461

Now

The Monthly payment for 30-year loan

P = $900,000[0.00833(1 + 0.00833)^360] ÷ [(1 + 0.00833)^360 - 1]

= $7898.1441

So,  

Difference is

= $9671.4461 - $7,898.1441

= $1,773.3019

b.

Now

Total payment for 30-year loan is

= $7,898.1441 × 180

= $2,843,331.8871

And,

Total payment for 15-year loan is

= $9,671.4461 × 360

= $1,740,860.2907

So,

Difference is

= $2,843,331.8871 - $1,740,860.2907

= $1,102,471.60

i.e. option c

7 0
4 years ago
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