Answer:
0.09 or 9%
Explanation:
This question has some irregularities. The correct question should be :
Elinore is asked to invest $4,900 in a friend's business with the promise that the friend will repay $5,390 in one year's time. Elinore finds her best alternative to this investment, with similar risk, is one that will pay her $ 5,341 in one year's time. U.S. securities of similar term offer a rate of return of 7%. What is the opportunity cost of capital in this case?
Solution
Given from the question
Investment (I) = $4,900
Return on investment (ROI) in one year = $5,341
Rate or opportunity cost of capital r is given by
ROI = I × (1 + r)
input the given data
$5,341 = $4,900 (1 + r)
$5,341 = $4,900 + $4,900r
$5,341 - $4,900 = $4,900r
r = ($5,341 - $4,900) / $4,900
r = 0.09
Or 9% in percentage
Answer:
PV of annuities =$3,021.53
Explanation:
<em>The present value of the annuity would be as follows;</em>
First annuity of $1000:
PV = A × (1- (1+r)^(-n)/r
PV = Present Value , r- rate of return, n-number of years
PV = 1000× (1- (1.06)^(-2)
PV= $1,833.39
The second annuity
PV = 1,500 x (1-1.06^(-2)× 1.06^(-2)= 1,188.140
PV = $1,188.140
PV of the annuities = $1,833.39 + $1,188.140 =$3,021.53
PV of annuities =$3,021.53
Answer:
D
Explanation:
Wealth is the value of all the assets a person owns
Beth is pondering on the value of all her assets less her debt. So, she is pondering on her wealth
Answer:
b. 11,338 units
Explanation:
The computation of the amount of sales in units is shown below:
Let us assume the amount of sales in units is X
So, the equation is
Profit = Sales - Variable Expenses - Fixed Cost
where,
Profit = $217,000
Sales = $238 × X
Variable expense = $105 × X
And, the fixed cost is $1,291,000
So, the sales in units is
$217,000 = $238 × X - $105 × X - $1,291,000
$1,508,000 = $238 × X - $105 × X
$1,508,000 = $133 × X
So, the X = 11,338 units
Answer:
Value of the stock today=18.51
Explanation:
Price of the stock today = 
.
where and P6= 
Estimate of the stock's current price = 
= 18.51
