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Zina [86]
2 years ago
10

Mark Weinstein has been working on an advanced technology in laser eye surgery. His technology will be available in the near ter

m. He anticipates his first annual cash flow from the technology to be $175,000, received two years from today. Subsequent annual cash flows will grow at 3.8 percent in perpetuity. What is the present value of the technology if the discount rate is 9.7 percent? 27. Perpetuities A prestigious i
Business
1 answer:
Zina [86]2 years ago
5 0

Answer:

<u>PV = 2,464,749.47</u>

Explanation:

Perptuities = ammount/ (rate - growth)

175,000/(0.097-0.038) = $2,966,101.695

This value is two years from the present day.

Notice:<em> "it will be received two years from today"</em>

<em>So we need to adjusted to bring it to present</em>

<em>\frac{Principal}{(1 + rate)^{time} } = PV</em>

\frac{2,966,101.695}{(1 + 0.097)^{2} } = PV

<u>PV = 2,464,749.47</u>

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Demand per hour for gasoline at a local station is normally distributed with a mean of 875 gallons and std deviation of 55 gallo
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The probability that demand is greater than 1800 gallons over a 2 hour period is : 0.5

<u>Given data :</u>

Mean value of gasoline per hour = 875 gallons

Standard deviation = 55 gallons

<h3>Determine the probability of demand being greater than 1800 gallons over 2 hours </h3>

Demand for gas in 1 hour = X₁

Demand for gas in 2 hours = X₁ + X₂

Therefore ; ( X₁ + X₂) ~ N ( u₁+u₂, sd₁² + sd₂² )

In order to  calculate probabilities for normals apply the equation below

Z = ( X- u ) / sd

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using the z-table

P( Y > 1800) = P( Z > ( 1800 - 1800 ) / 77.78)

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2 years ago
Which of the following data is used to determine credit scores?
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Handy Man, Inc., has zero coupon bonds outstanding that mature in eight years. The bonds have a face value of $1,000 and a curre
AnnZ [28]

Answer:

5.657%

Explanation:

Data provided:

Face value = $1,000

Current market price = $640

Time of maturity, t = 8 year

Now,

the compounding formula is given as:

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or

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How are trade deficits related to foreign capital inflows and investment in the united states? gov 312l
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