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True [87]
3 years ago
15

You work for a pharmaceutical company that has developed a new drug. The patent on the drug will last 1717 years. You expect tha

t the​ drug's profits will be $ 5$5 million in its first year and that this amount will grow at a rate of 2 %2% per year for the next 1717 years. Once the patent​ expires, other pharmaceutical companies will be able to produce the same drug and competition will likely drive profits to zero. What is the present value of the new drug if the interest rate is 10 %10% per​ year?
Business
1 answer:
jeka57 [31]3 years ago
7 0

Answer:

Present value = $45,185,606

Explanation:

Data:

number of periods(n) = 17 years

First-year profit = $5 million

Growth rate = 2%

Interest rate = 10%

Present value = ?

Solution:

The present value of the growing annuity can be calculated as follows

Formula:

Let's denote

annual interest rate = x

annual growth rate = y

Present value = First-year profit x (\frac{1-(\frac{1+y}{1+x} )^{n} }{x-y} )

Present value = $5,000,000 x (\frac{1-(\frac{1+0.02}{1+0.1} )^{17} }{0.1-0.02} )

Present value = $5,000,000 x 9.03

Present value = $45,185,606

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Brilliant_brown [7]
Just look it up. lol.
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3 years ago
A banking department form required when a person is acting as a mortgage broker and a real estate broker in the same transaction
Anna007 [38]

Answer:

Mortgage Broker Dual Agency Disclosure Form

Explanation:

The Mortgage Broker Dual Agency Disclosure Form is a document a broker needs to fill in when he/she acts as a mortgage broker and real estate broker in the same operation to inform the buyer and the seller before he/she can provide the services and it must be signed by both parties. So, according to this, the answer is that a banking department form required when a person is acting as a mortgage broker and a real estate broker in the same transaction is known as the Mortgage Broker Dual Agency Disclosure Form.

3 0
4 years ago
The windows 10 desktop has controls, also known as its ____, that allow you to interact with the windows 10 operating system.
vitfil [10]
The answer in the space provided is user interface. It enables you to interact with the operating system as it is a system that enables you to use to interact with your computer. It is a way of how you can access your operating system and interact with the programs or appications that are placed or saved on your computer.
8 0
4 years ago
Some organizations use internal service departments to provide like services to several divisions or departments within an organ
andrew-mc [135]

Answer:

The correct answer is B that is Inventory control

Explanation:

Service department is the department or a cost center which provides the services to the rest of a organization. The manager who is responsible for keeping the costs down in the service department.

So, the inventory control will not be the one who will lend itself in the service department because the inventory control is defined as the supervision and the coordination of the storage, recording of materials and supply in order to maintain the adequate quantities for the needs.

3 0
4 years ago
When the price of a bar of chocolate is $1, demand is 100,000 bars. When the price rises to $1.50, demand falls to 60,000 bars.
Stella [2.4K]

Answer:

Instructions are listed below

Explanation:

Price elasticity of demand is an economic measure of the change in the quantity demanded or purchased of a product to its price change. If the quantity demanded of a product exhibits a large change in response to changes in its price, it is termed "elastic," that is, quantity stretched far from its prior point. If the quantity purchased has a small change in response to its price, it is termed "inelastic", or quantity didn't stretch much from its prior point.

Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price

A) PED= [(Q2-Q1)/Q1]/[(P2-P1)/P1]

PED= [(1.5-1)/1]/[(60000-100000)/100000]= 1.25

B) PED= [(1-1.5)/1.5]/[(100000-60000)/60000]= 0.5

C)Midpoint formula:

PED= {(Q2-Q1)/[(Q2+Q1)/2]}/{(P2-P1)/[P2+P1)/2]}

PED= {(60000-100000)/[(60000+100000)/2]}/{(1-1.5)/[1+1.5)/2]}

PED=0.5/0.4= 1.25

D) Midpoint formula:

PED= {(Q2-Q1)/[(Q2+Q1)/2]}/{(P2-P1)/[P2+P1)/2]}

PED= {(100000-60000)/[(100000+60000)/2]}/{(1.5-1)/[1.5+1)/2]}

PED= 0.5/0.4= 1.25

7 0
3 years ago
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