Answer:
Present value = $416666.6667 rounded off to $416666.67
Explanation:
To calculate the most the firm could pay for the project, we will need to calculate the present value of the project when discounted at the WACC for the project, which is equal to the WACC for the firm in this case. The cashflows from the project will be perpetual, thus we will use the formula for the present value of perpetuity.
Present value of perpetuity = Cash flow / r
Where,
r is the rate of discount or discount factor which in this case is WACC
Present value = 50000 / 0.12
Present value = $416666.6667 rounded off to $416666.67
Answer:
The correct answer is "Organizing"
Explanation:
Organizing is the function of management that associate the success of an organizational structure and designate human resources to ensure the achievement of objectives. Decisions of the structure of an organization are generally called "organizational design" decisions.
Answer:
Instructions are listed below.
Explanation:
Giving the following information:
You have 45 years left until retirement and want to retire with $4 million. Your salary is paid annually, and you will receive $50,000 at the end of the current year. Your salary will increase at 3 percent per year, and you can earn an annual return of 9 percent on the money you invest.
n= 45
FV= 4,000,000
i= 9% + 3%= 12%
We need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (4,000,000*0.12)/{(1.12^45)-1}= $2,945
5.89% per year.
Answer: The bond will be issued at a premium
Explanation: If the interest rate on bond is higher than the market interest rate then the investors of such bond will get a greater benefit. Hence to get the greater benefit an investor must pay a higher value, thus, the bond will be issued at premium.
Higher interest rate means the company will pay interest to investors mare than i the general rate in market, Therefore, company can charge investors more from a more valuable asset.
Hence from the above we can conclude that the correct option is c.
Answer:
$210,000
Explanation:
The computation of the external price is shown below
Making cost = buying cost
$120,000 + $25,000 + $45,000 + $30,000) = external price + Unavoidable fixed cost (30,000-20,000)
$220,000 = External price + $10,000
So,
External price = 210,000
Hence, the same is to be considered
Therefore the external price is $210,000
