Answer:
The IRR is 4.08%
Explanation:
In calculating the internal rate of return in excel,the cash outflow of $76.63 is shown in year 0 with a negative sign to indicate that it is the initial investment on the share, followed by dividends in received in later years shown as positive figures ,however in the fifth the dividend received and the cash received from disposing of the share were added together to show total cash inflow in the last year.
The computation of IRR is shown below
IRR for the share purchase
Years Cash flow
0 -76.63
1 1.37
2 1.55
3 1.66
4 1.74
5 86.61
IRR 4.08%
Find attached for detailed computation.
Answer:
product concept
Explanation:
The definition of the product concept implies that customers prefer goods that have higher quality, price, and functionality than a standard product. In some niche markets such as computers and mobile phones, the definition is really true.
The product concept relates to a compulsory philosophy to provide the consumer with the best model possible according to need and requirement. A product is not sufficient on its own and needs the performance of many other market aspects such as advertising, shipping, sales, operation, etc.
(12-6)/12 gives you the growth rate *over five years* (115%)
divide that by 5 and you get an average rate of 23% growth per year.
If we’re rounding, yes, that statement is correct. Otherwise, growth over five years doubled because there was a growth of 115% and year-over-year growth was 23%.
Answer:
b. The stock price will not change, because the market had already incorporated the information about the FDA approval announcement in the stock price.
Explanation:
If the markets are strong form efficient, it means the consensus of the market related to future impact of FDA approval on earnings would be correct, the stock price of today correctly estimates the future earnings, and therefore the stock price would not change when the earnings are released.
If the internal rate of return is used as the discount rate in the net present value calculations, the net present value will be equal to zero. The internal rate of return (IRR) is a financial analysis metric used to estimate the profitability of potential investments.
The IRR calculations use the same formula as NPV calculations. Keep in mind that the IRR is not the project's actual the dollar value. The annual return is what brings the NPV to zero. The IRR is calculated in the same way as net present value (NPV), except that it sets NPV to zero.
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