The answer is "build or buy decision".
A build-or-buy decision is the demonstration of picking between assembling an item in-house or acquiring it from an outer provider. In a build-or-buy decision choice, the most critical elements to consider are a piece of quantitative examination, for example, the related expenses of generation and whether the business has the ability to create at required levels.
You did not post the complete question so I will write only the missing components below that is needed to answer the question and some important definitions.
Definitions:
PVIFA - present value interest factor of annuity
= number of regular intervals per year at which time the borrowed amount is to be paid back
= annual interest rate
= number of years to payoff the debt
We need to find the interest rate that equates the price we paid for the bond with the cash flows we received. The cash flows we received were $100 each year for two years and the price of the bond when we sold it. Also, remember the YTM on the bond has declined by 1 percent.
Let us assume a par value of $1,000. we need to find the price of the bond in two years. The price of the bond in two years, at the new interest rate, will be:
$100(PVIFA8.42%,17) + $1,000(PVIF8.42%,17) = $1,139.69
Answer:
Therefore, the bond will sell for $
1,139.69 ± 0.1%
Answer:
The answer is "9%".
Explanation:
Please find the complete question in the attached file.
The formula for calculating the net return rate:
Therefore, the net return rate is 9%.
Answer: $ 70,500
Explanation:
Given, Number of units = 1800
Per unit selling price = $85
Total Sales price = (Number of units ) x (Per unit selling price)
= 1800 x $ 85
= $153,000
Variable cost per unit = $68
Total variable cost = 1800 x $68 = $122,400
Contribution Margin = (Sales price ) - (Variable cost)
= $ (153000-122400)
= $30,600
Fixed cost = $16,500 per month
Profit = (Contribution Margin) - (Fixed cost)
= $(30,600-16,500)
= $14,100
PV ratio = (Contribution Margin) ÷ (Total sales) x 100%
= $ (30,600÷153,000)x 100%
=20%
Margin of Safety = (profit) ÷ (PV ratio)
= ($14,100) ÷ (20%)
= ($14,100) ÷ (0.20)
= $ 70,500
Hence, the monthly margin of safety = $ 70,500
From the information given, the total interest payable on the mortgage is 290, 659.84 See the calculation and analysis below.
<h3>What is the calculation on the above mortgage scenario?</h3>
We are given
Vacation Home purchase amount = $250,000
Down payment = 20% i.e. $235,000 X 20% = $50,000
Loan Amount = $250,000 - $50,000
Rate = 7%
Period = 22 years = 22 x 12 = 264 monthly installment
Monthly installment = $1,858.56 (See attached spread sheet).
Recall that Total interest paid
= Monthly Installment X N - Principle loan amount
Hence,
1,858.56 x 264 - 200,000
= 490,659.84 - 200,000
Total interest paid = 290, 659.84
Learn more about interest on mortgage at;
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