Answer:
$7,213.40
Explanation:
The computation of the net present value is shown below:
= Present value of all yearly cash inflows after applying discount factor - initial investment
where,
Initial investment is $50,000
And, the present value till 3 year would be
= Annual cash flows × PVIFA factor for 3 years at 12%
= $18,000 × 2.4018
= $42,232.40
And, the present value for fourth year would be
= Annual cash flows × present value factor
= $22,000 × 0.6355
= $13,981
So, the total present value would be
= $43,232.40 + $13,981
= $57,213.40
Since the annual cash flows are same for the three years so we use the PVIFA table
Refer to the PVIFA table
Now put these values to the above formula
So, the value would be equal to
= $57,213.40 - $50,000
= $7,213.40
Answer:
The explanation is below
Explanation:
A. Shutdown point is achieved when price equal AVC. when price lowers than the AVC, firm shutdown.
VC = q^2
AVC = q
So,
P = q is the shutdown point.
B. For profit maximizing level of output,
P = MR = MC
500 = 20 + 2q
q = 240 units
So, profit maximization level of output = 240 units
C. Firm level supply curve = MC curve above the shutdown point
Number of firms = 5
So,
Industry supply curve = 10*MC = 200+20Q
Industry supply curve = 200+20Q
It shows that MC curve above the shutdown point is supply curve.
Answer:
Debt / Equity = 0.72649 : 1 or 72.649%
Explanation:
The ROE or return on equity can be calculated using the Du Pont equation. It breaks the ROE into three components. The formula for ROE under Du Pont is,
ROE = Net Income / Sales * Sales / Total Assets * Total Assets / Shareholder's equity
or
ROE = Net Income / Total equity
Assuming that sales is $100.
Net Income = 100 * 0.051 = 5.1
Total Assets = 100 / 1.84
Total Assets = 54.35
0.162 = 5.1 / Total equity
Total Equity = 5.1 / 0.162
Total Equity = 31.48
We know that Assets = Debt + Equity
So,
54.35 = Debt + 31.48
Debt = 54.35 - 31.48
Debt = 22.87
Debt / Equity = 22.87 / 31.48
Debt / Equity = 0.72649 : 1 or 72.649%
Answer:
She should invest $300,000 in Project A, and $200,000 in Project B.
Explanation:
Solution
Since Project B yields a higher return, she should invest as much money as possible in it, which is 40% of the total investment or
or (0.40)($500,000) = $200,000
so
The remaining $500,000 - $200,000 = $300,000 should be invested in Project A.
Therefore, she should invest $300,000 in Project A, and $200,000 in Project B.
Answer:
Personal-use
Personal
Real
Explanation:
There are three types of properties which are shown below:
1. Personal use: These properties which are used by a person for their personal purpose rather than business purpose like - clothing, jewelry, home, car for their comfort and enjoyment.
2. Personal: These include those properties which are movable or transferable for one place to other like - machinery, furniture, other building, etc as per the needs.
3. Real: These properties include properties that are non-movable i.e land, building, canals, etc. This is also known as immovable properties.
