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IgorLugansk [536]
3 years ago
13

Hillsdale is considering two options for comparable computer software. Option A will cost $25,000 plus annual license renewals o

f $1,000 for three years, which includes technical support Option B will cost $20,000 with technical support being an add-on charge. The estimated cost of technical support is $4,000 the first year, $3,000 the second year, and $2,000 the third year. Assume the software is purchased and paid for at the beginning of year one, but that technical support is paid for at the end of each year. Interest is at 8%. Ignore income taxes.
Required: Determine which option should be chosen based on present value considerations.

Business
1 answer:
Jlenok [28]3 years ago
4 0

Answer:

Option a should be selected

Explanation:

After considering the PV of both options A and B the option that has been selected is A.

For option A:-

A total of the present value of option A= -25000-925.926-857.339-793.832 = -27577.097

Present value = 27577

For option B,:-

Total = -20,000-3703.704-2572.017-1587.664

= -27863.385

The present value of option B = 27863

From the calculations I have attached, it is evident that option A has lower present value compared to option B. Therefore option A should be selected.

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When establishing an ad campaign in a foreign country, what does the difference in currency exchange rate affect the most?
pentagon [3]

Answer:

Option A. The cost structure of the ad campaign

Explanation:

The reason is that the currency exchange rate effects the transactions of money from home to foreign or foreign country to home country. So the option with money transaction is option A.

The rest of the options are planning and are things that are not associated with the foreign transactions. So the remainder options are not the one which will be effected by the currency exchange rate.

4 0
3 years ago
Jennifer Schwab is an investor in The Handy Man Pro Shops. On January 1, she purchased 225 shares of stock at a price of $15 per
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Answer:

C. $3,375

Explanation:

Calculation for the value of this stock on the company's balance sheet on December 31

Stock value= 225 shares* $15 per share

Stock value=$3,375

Therefore the value of this stock on the company's balance sheet on December 31 will be $3,375

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3 years ago
Assume that you are participating in your employers direct deposit program. On payday, the employer deposits your _____ into you
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6 0
3 years ago
Read 2 more answers
"For whom is a given mix of goods and services to be produced? How, in other words, are the society's outputs to be distributed
WINSTONCH [101]

Answer:

d. Private sector through the earning and spending of income.

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Therefore these questions are answered in the private sector when the consumer earns income and spends it on their needs.

8 0
3 years ago
CASE STUDYBUSINESS LAWAnderson Darragh, a real estate agent for RE/MAX, informed Bryan Thomas, a real estate developer, that he
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Based on legalities, Thomas has the right to refuse payment of the 8% commission to RE/MAX because he already stated his refusal during the meeting with Darragh nor did he sign the document that Darragh gave him during the meeting. Thus, there was no meeting of minds. 

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Darragh can't claim that he worked on implied consent from Thomas because Thomas specifically stated his refusal in paying for the 8% commission during their meeting but Darragh did not stop to renegotiate the commission nor convince Thomas to accept the contract. 
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