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irga5000 [103]
3 years ago
15

If a politician wanted to bias the net present value of $1,000 in 10 years upwards, and they know the discount rate is either 2%

or 6%, are they better off reporting the net present value of $1,000 under a 4% discount rate, or reporting the average of the net present value under a 2% discount rate and the net present value under a 6% discount rate?

Business
1 answer:
-Dominant- [34]3 years ago
5 0

Answer:

NPV at 4% discount rate= $675.56

Average of NPVs at 2% discount rate and 6% discount rate= $689.37

In order to bias NPV, it is better to report the average of NPVs at 2% and 6% discount rates.

Calculations as below:

[ Find the attachment]

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Explanation:

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3 years ago
Signal mistakenly produced 1,450 defective cell phones. The phones cost $64 each to produce. A salvage company will buy the defe
posledela

Answer:

Incremental income from reworking the phone   is $49,300

Explanation:

                         Scrap              Rework

Sales                $46,400          $214,600

                        <em>(32 * 1,450)      (148 * 1,450)</em>

<em />

- Rework costs       0                   $118,900

                          <u>                         </u><em><u>(82 * 1,450)</u></em>

Profit                 <u>$46,400            $95,700</u>

Incremental income from reworking the phone  

= $95,700 - $46,400

= $49,300

5 0
4 years ago
Letitia is a salesperson. She routinely sells at a lower volume than her colleagues. However, she offers excellent customer serv
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Answer: halo error

                                     

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In the given case, Letitia is evaluated above than others although she sells lesser volume than others. This happens due to the perception of her supervisor that customer service is more important.

4 0
3 years ago
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