Answer:
The most the firm can spend to lease the new equipment without losing money=$75,000
Explanation:
The point at which the revenue in terms of sales equals the cost is the break-even point. This can be expressed as;
R=C
where;
R=revenue from sales
C=cost
And;
R=P×N
where;
R=revenue from sales
P=price per unit
N=number of units
In our case;
P=$7.5 per unit
N=10,000 units
replacing;
R=7.5×10,000=$75,000
Total revenue from sales=$75,000
C=p×n
where;
p=cost per unit
n=number of units
In our case;
p=$5
n=unknown
replacing;
C=5×n=5 n
At break-even point, R=C;
5 n=75,000
n=75,000/5=15,000
The break-even cost=5×15,000=$75,000
The most the firm can spend to lease the new equipment without losing money=$75,000
Answer: C. clean and fast-growing and that pay
Explanation:
Answer:
The objective of present Value is to present a set of cash flows based on their estimated fair value; to help decision makers in assessing the viability or otherwise of an option of investments.
Values don't stay the same year on year, various influences act to most times make the same $ amount lessened by tomorrows valuation; some factors like inflation, obsolescence, opportunity cost of not investing in other activities (cost of capital)....all these play a role in determining time value of money.
Present value attempts to harmonize all these influences and present a fair value of our $ dollar estimate of future values based on the impact of these factors.
B I believe this is the right answer