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3 years ago

You are considering two independent projects that have differing requirements.

Business

1 answer:

Ugo [173]3 years ago

4 0

Answer:

I will accept Project "B."

Explanation:

Though, Project B has a higher required Return on Investment ROI which is 13.5% but has a progressive increasing cash flow of Project B has an initial cost of $70,000 and cash flows of $15,000, $18,000, and $41,000 for Years 1 to 3, respectively.

Analysis of the Cash Flow: 

$18,000.00 - $15,000.00 = $3,000.00

$41,000.00 - $18000.00 = $23,000.00.

∴ with Initial Outlay of $70,000.00

$3,000.00 + $23,000.00 = $26,000.00

while

Project A has a retrogressive trend of cash flow of $21,000.00

∴$49,000.00 - $21,000.00 = $28,000.00

$28,000.00 - $12,000.00 = $16,000.00

Therefore comparing the two figures from Project A & B respectively:

Project A = $16,000.00

Project B = $26,000.00

It shows a deficit of $10,000.00 for Project B & surplus of $10,000.00 for Project A in the 3 years of required ROI.

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Alpha Corporation reported the following data for its most recent year: sales, $670,000; variable expenses, $420,000; and fixed

MariettaO [177]

Answer:

the degree of operating leverage is 5

Explanation:

The computation of the degree of operating leverage is given below:

= Contribution margin ÷ EBIT

= (Sales - Variable expense) ÷ (Sales - Variable expense - Fixed expense)

= ($670,000 - $420,000) ÷ ($670,000 - $420,000 - $200,000)

= $250,000 ÷ $50,000

= 5

Hence, the degree of operating leverage is 5

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3 years ago

Team members get to know each other in the:

Andrews [41]

Answer:

Explanation:

Team members get to know each other in the forming stage of group development. It is the period of orientation and when team members become acquainted with each other. However it just the first stage in the long process and people view each other as strangers.

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3 years ago

Read 2 more answers

If the law of increasing opportunity costs is operable, and currently the opportunity cost of producing the 101st unit of good X

lys-0071 [83]

Answer:

C) more than 5Y

Explanation:

the opportunity cost of producing 101 units of X = 5 units of Y

if the opportunity costs increase as the number of units produced increases, then the opportunity cost of producing 201 units of X will be more than 5 unit of Y. This is simply because 5 units of Y was the opportunity cost of producing 101 units of X and the opportunity costs are increased.

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3 years ago

The current price of a stock is $50, the annual risk-free rate is 6%, and a 1-year call option with a strike price of $55 sells

Vlad [161]

Answer:

The value of the put option is;

e. $9.00

Explanation:

To determine the value of the put option can be expressed as;

C(t)-P(t)=S(t)-K.e^(-rt)

where;

C(t)=value of the call at time t

P(t)=value of the put at time t

S(t)=current price of the stock

K=strike price

r=annual risk free rate

t=duration of call option

In our case;

C(t)=$7.2

P(t)=unknown

S(t)=$50

K=$55

r=6%=6/100=0.06

t=1 year

replacing;

7.2-P=50-55×e^(-0.06×1)

7.2-P=50-(55×0.942)

7.2-P=50-51.797

P=51.797+7.2-50

P=$8.997 rounded off to 2 decimal places=$9.00

6 0

3 years ago

The oil price shocks of 20062009: Between 2006 and the middle of 2008, oil prices rose sharplyfrom around $60 to more than $140

dolphi86 [110]

Answer:

A supply shock is an unpredictable incident that changes the supply of a product or a service, subsequent in an unexpected modification in its value. Supply shocks can be undesirable (decreased supply) or optimistic (increased supply)

(a) The two types of shock which are:

Primarily the growth in oil values is a negative supply shock causing from a decline in supply of oil
The reduction in oil charges is a Positive supply shock causing from a growth in supply of oil.

(b) If the charges of oil increases as in case (i) that will push companies’ prices and thus decrease SRAS. The new equilibrium will be established at a inferior level of output and higher charge level. This is reflected in the diagram attached.

In the case (ii), the opposed of this will occur. The SRAS will rise shifting the SRAS rightward and carry about a new equilibrium at upper level of output and lesser prices.

6 0

3 years ago