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e-lub [12.9K]
3 years ago
11

Major Corp. is considering the purchase of a new machine for $5,000 that will have an estimated useful life of five years and no

salvage value. The machine will increase Major's after-tax cash flow by $2,000 annually for five years. Major uses the straight-line method of depreciation and has an incremental borrowing rate of 10%. The present value factors for 10% are as follows:Ordinary annuity with five payments 3.79Annuity due for five payments 4.17Using the payback method, how many years will it take to pay back Major's initial investment in the machine?
Business
1 answer:
Mila [183]3 years ago
3 0

Answer:

payback 2.5 years

Explanation:

the payback will be the point in time at which the project cash flow equal the invesmtent.

This method do not consider the time value of money so we don't have to adjust any period cashflow or outflow.

investment: 5,000

increase in cash-flow 2,000

Investment/cash flow = 5,000 / 2,000 = 2.5 years

The depreciation are not considered as this are not cash flow.

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The range rule of thumb roughly estimates the standard deviation of a data set as​ _______.
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Range is the measure of variation that is very sensitive to extreme values. It is the difference between high and low values, while standard deviation is the standard measure of variation.The range rule of thumb roughly estimates the standard deviation of a data set as s=range/4 , where s stands for standard deviation and
<span>range = Maximum - Minimum</span>
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3 years ago
Which of the following is true of F a c e b o o k advertisements?
morpeh [17]
They’re affordable and highly targeted.
8 0
3 years ago
Which of the following types of teams is the most autonomous?A. Self-managing teamsB. Quality circlesC. Semiautonomous work grou
coldgirl [10]

Explanation:

Autonomy -

It is refers to the degree to which the workers have the freedom , discretion , independence , so as to decide when and how to accomplish their jobs .

Hence , from the options given in the question ,

  • The most autonomous are the self designing teams and the  self - managing teams .
  • The least autonomous are the employee involvement groups and the  traditional work groups .
  • The moderate autonomous is the semi autonomous work groups .
7 0
3 years ago
What are examples of the substitution effect and/or real-income effect?
Arlecino [84]

The options available are:

A. After subscription prices in the cable TV market fall, customers also purchase higher-speed Internet service.

B. Julie usually buys generic cereal because it is cheaper. One day she notices one of the brand-name products falls in price, so she decides to buy it.

C. Movie ticket prices plummet to $1, so you cancel your Netflix subscription in favor of attending movies at the theater. In addition, the cheap tickets leave you with extra money for concessions.

D. Kyle notices the cost of premium peanut butter has fallen. He considers this and then purchases less bread.

Answer:

The answers are A, B, and C

Explanation:

The options available are:

Option A. "After subscription prices in the cable TV market fall, customers also purchase higher-speed Internet service" is a perfect example of the real income effect.

Option B. "Julie usually buys generic cereal because it is cheaper. One day she notices one of the brand-name products falls in price, so she decides to buy it," is an example of the substitution effect.

While Option C. "Movie ticket prices plummet to $1, so you cancel your Netflix subscription in favor of attending movies at the theater. In addition, the cheap tickets leave you with extra money for concessions, " is an example of both the substitution and real-income effects

However, option D example "Kyle notices the cost of premium peanut butter has fallen. He considers this and then purchases less bread, " does not fit any of the substitution and real-income effects.

8 0
3 years ago
At the current prices of goods X and Y, the quantity demanded of good X is 10 units, and the quantity demanded of good Y is 5 un
damaskus [11]

Answer:

When the price of good y increases by 10% it will result in the quantity demanded of x to increase by (0.6*10) =6%. The current quantity demanded of good x is 10 so a 6% increase will mean the quantity demanded of x will be (1.06*10)= 10.6

Explanation:

The cross elasticity of goods x and y is 0.6, which means that a one percent increase in price of good y will increase the demand for good x by 0.6%, this means that x and y are substitute goods, as when the price of y increases people tend to buy more of x.

When the price of good y increases by 10% it will result in the quantity demanded of x to increase by (0.6*10) =6%. The current quantity demanded of good x is 10 so a 6% increase will mean the quantity demanded of x will be (1.06*10)= 10.6

8 0
3 years ago
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