According to reference.com "It is important to continue honoring veterans because it is a way of acknowledging the sacrifices they have made while serving their country. Without the service of veterans, Americans may not have the freedoms they do today."
Answer:
PV= $124,867.78
Explanation:
Giving the following information:
Cash flow= $37,250
Discount rate= 15%
Number of periods= 5 years
<u>To calculate the present value, we need to use the following formula:</u>
PV= A*{(1/i) - 1/[i*(1 + i)^n]}
PV= 37,250*{(1/0.15) - 1/[0.15*(1.15^5)]}
PV= $124,867.78
Answer:
e) Increase the required rate of return used to evaluate the project to reflect the higher risk of the project
Explanation:
As per the basic concept of investment, "higher the risk, higher the return".
Thus, an investor assumes a higher risk only in the scenario wherein the expected return would be commensurate with such risk. Investor would only invest in a risky asset when the return derived can compensate him for the excess risk assumed.
Required rate of return is an investors expectation of return from a project also referred to as the cost of capital.
So for the purpose of evaluating the project, the investor should use a higher required rate of return to signify higher risk which would reveal the true viability of the project.
Answer:
the median is the correct answer.
Explanation:
