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poizon [28]
3 years ago
13

Al Darby wants to withdraw $20100 (including principal) from an investment fund at the end of each year for five years. How shou

ld he compute his required initial investment at the beginning of the first year if the fund earns 8% compounded annually?
Business
1 answer:
Darya [45]3 years ago
3 0

Answer:

The value of the initial investment was $15749

Explanation:

$20100 times the present value of a 5-year, 8% ordinary annuity of 1.

The present value at the year zero can be found using the discounting formula which is as under:

Present value = Future Value / (1+r)^n

Here n is 5 years, r is 5% and the future value is $20100.

By putting the values in the formula:

Present Value = $20100 / (1+5%)^5 years = $15749

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Management at Work While reading the newspaper one day, you come across an article discussing the diversity strategy presented b
Leno4ka [110]

1. Kellogg's is likely to experience Reduced turnover when compared with other companies that do not promote diversity

2. He likely to report about his shares of stock, Since the implementation of the diversity strategy, my shares have increased in value.

Explanation:

Benefits of good diversity management are -

  1. Harmonious working conditions
  2. Better involvement of employees
  3. Improved performance of employees
  4. Improved manufacturing processes
  5. Enhanced product quality
  6. Retained sales (i.e. higher level of employee retention)

Good management of diversity means greater profit and a better brand image.

Turnover is the replacement of an employee with a new hire throughout the realm of human resources. Turnover means a proportion of the employees who leave the company for a certain period of time.

6 0
3 years ago
Assume you are to receive a 30-year annuity with annual payments of $2,000. The first payment will be received at the end of Yea
max2010maxim [7]

Answer:

Total FV= $678.615.02

Explanation:

<u>First, we need to calculate the value of the annuity at the end of the last payment:</u>

FV= {A*[(1+i)^n-1]}/i

A= annual deposit

FV= {2,000*[(1.06^30) - 1]} / 0.06

FV= $158,116.37

<u>Now, the total future value after 25 years:</u>

FV= PV*(1 + i)^n

FV= 158,116.37*(1.06^25)

FV= $678.615.02

6 0
3 years ago
Why is it important to understand economics
Nookie1986 [14]
Macroeconomics is important because it allows the public to understand the economy as a whole, fiscal policy and global economic policy.
5 0
3 years ago
You and your friends have decided to build a skateboard ramp behind your house. You have already purchased $500 in materials and
alexandr402 [8]

Answer:

(a) $500

(b) $620

(c) $180

(d) $72

Explanation:

Explicit costs refers to the which are incurred during running the business and these costs affects the profitability of the company.

Implicit costs refers to the opportunity cost of selecting some other alternative.

(a) Here, the explicit cost is the cost of purchasing materials = $500

(b) If I rent an electric saw, then the explicit cost is as follows:

= Purchasing cost of material + (Rent × No. of hours to build ramp)

= $500 + ($20 × 6 )

= $500 + $120

= $620

(c) If I use a handsaw, then the implicit cost is as follows:

= Hours to build ramp × A job pays $12 per hour

= 15 × $12

= $180

(d) If I rent an electric saw, then the implicit cost is as follows:

= Hours to build ramp × A job pays $12 per hour

= 6 × $12

= $72

4 0
3 years ago
Gains from remeasuring a foreign subsidiary’s financial statements from the local currency, which is not the functional currency
Archy [21]

Answer:

Gains from remeasuring a foreign subsidiary’s financial statements from the local currency, which is not the functional currency, into the parent company’s currency should be reported as a(n):_______

d. Part of continuing operations.

Explanation:

Gains from the remeasurement of a subsidiary's financial statements from the local currency to the parent company's currency should be reported as part of the continuing operations.  It forms part of the current income.  They are not deferred.  It is translation adjustments that are reported as other comprehensive income, not gains from remeasurement. Remeasurement gains from a subsidiary's local currency to the parent's are also not extraordinary items.

4 0
3 years ago
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