Answer:
16.99%
Explanation:
Calculation for the crossover rate
We are going to to calculate the crossover rate using cash flow function on a financial calculator by following the step below:
CF0= 0
Step 1
C01=Project A year 1 -Project B year 1
C01=$28,300-$36,900
C01= -$8,600
Step 2
C02=Project A year 2 -Project B year 2
C02=$31,500-$40,500
C02= -$9,000
Third step
C03=Project A year 3
C03=$22,300
Last step
Press CPT key in order for IRR(INTERNAL RATE OF RETURN) to be display
Hence:
Crossover rate=16.99%
Therefore the Crossover rate will be 16.99%
Answer:
Correct option is B.
The net benefit of the activity you would have chosen if you had not taken the course
Explanation:
Your opportunity cost of taking this course is <u>the net benefit of the activity you would have chosen if you had not taken the course
</u>
Opportunity cost is what you must sacrifice when you choose an activity. By taking this course, you are sacrificing the benefit you could have obtained from the activity you would have chosen if you had not taken the course.
Answer:
The economic incentive was to produce enough to meet the output target, without regard for quality or cost.
Explanation:
As the only condition for the payment to the producers is linked with the output thus there is no constraint for the quality and the sales of the product. This indicated that the producer will get the reward irrespective whether the quality or cost of the product is feasible or not.
Find a convenient and reasonable unit of measurement to use, then divide the cost of the package by the number of units chosen in that package.
Answer:
(B) 16.25%
Explanation:
Using the multifactor APT,
where 
= expected return on portfolio A,
= the risk free rate of return,
= beta on factor "i"
= risk premium on factor "i".
Therefore,
return on portfolio A = 7% + (0.5 * 1%) + (1.25 * 7%)
= 0.07 + (0.5 * 0.01) + (1.25 * 0.07)
= 0.07 + 0.005 + 0.0875
= 0.1625
= 16.25%.
