1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
grandymaker [24]
3 years ago
15

Obviously, the lifetime membership isn’t a good deal if you only remain a member for a couple of years, but if you remain a memb

er for 40 years, it’s a great deal. Suppose that the appropriate annual interest rate is 7.9%. What is the minimum number of years that Lloyd must remain a member of the ADLA so that the lifetime membership is cheaper (on a present value basis) than paying $750 in annual membership dues? (Note: Round your answer up to the nearest year.)
Business
1 answer:
earnstyle [38]3 years ago
7 0

Question:

Lloyd is a divorce attorney who practices law in Florida. He wants to join the American Divorce Lawyers Association (ADLA), a professional organization for divorce attorneys. The membership dues for the ADLA are $800 per year and must be paid at the beginning of each year. For instance, membership dues for the first year are paid today, and dues for the second year are payable one year from today. However, the ADLA also has an option for members to buy a lifetime membership today for $8,500 and never have to pay annual membership dues.

Obviously, the lifetime membership isn't a good deal if you only remain a member for a couple of years, but if you remain a member for 40 years, it's a great deal. Suppose that the appropriate annual interest rate is 7.9%. What is the minimum number of years that Lloyd must remain a member of the ADLA so that the lifetime membership is cheaper (on a present value basis) than paying $800 in annual membership dues?

A. 14 years

B. 13 years

C. 19 years

D. 23 years

Answer:

19 years (Kindly note the above question is bit different in numbers because I was unable to find the remainder part of your question. But it provides excellent understanding of the question).

Explanation:

Here, we have four options and we will start finding "Advance Annuity" from the least number which is 13% and then we move to a greater number.

<u></u>

<u>Best Choice:</u>

The best choice will be the one which is almost equal to or smaller than the value of the lifetime membership $8,500 and takes least time.

<u></u>

<u>For 13 Years</u>

Annuity = Cashflow * (1 + Annuity Factor at 7.6%)

Annuity at 7.6% for 13 years = (1 -  (1 + 7.6%)^-(13 - 1) / 7.6% = 7.6948

Annuity = $800 * (1 + 7.6948) =  $6,956

<u>Similarly for 14 Years:</u>

Advance Annuity = Cashflow * (1 + Annuity Factor at 7.6%)

Advance Annuity at 7.6% for 14 years = (1 -  (1 + 7.9%)^-(14 - 1) / 7.6% = 8.0807

Advance Annuity = $800 * (1 + 8.0807) = $7265

<u>Similarly for 19 Years:</u>

Advance Annuity = Cashflow * (1 + Annuity Factor at 7.6%)

Advance Annuity at 7.6% for 19 years = (1 -  (1 + 7.9%)^-(19 - 1) / 7.6% = 9.6377

Advance Annuity = $800 * (1 + 9.6377) = $8510.16

As the annuity value slightly crosses $8500, hence it is somewhat between 18 to 19 years. Thatswhy we will not consider the last option with 23 years as the nearest option is 19 years.

You might be interested in
If the consumption of a good by one individual does not change the amount of the good available to others, the good is considere
Pepsi [2]

Answer:

A. nonrival-in-consumption is the correct answer.

Explanation:

3 0
3 years ago
Compare transnet with a perfect competitor in terms of price and output and profit
Sergeu [11.5K]
Transnet SOC Ltd is a rail, port, and pipeline company in Johannesburg. 

Price: This company is a price maker, therefore, in terms of price, Transnet perfect compitetor is a price taker.

Output: Transnet has the ability to decide the quantity of their output and they have many competitors on this one.

<span>Profit: Transnet might be able to increase their profit but in a competition it would be hard because customers might switch to the competitor. </span>
6 0
2 years ago
Silky Inc., which sells custom silk ties designed by famous people, faces a demand curve of Q = 150 – 0.2P, where Q is measured
CaHeK987 [17]

Answer:

The production level that maximizes Silky's profit is 5000 ties.

Explanation:

Hi

First of all, as we have Q(P)=150-0.2P, we need to transcript it as price in function of the quantity so

P(Q)=\frac{150-Q}{0.2}=750-5Q

Then we need to find income function that is I(Q)=Q*P(Q)=750Q-5Q^{2}.  After derivate it I'(Q)=750-10Q.

The optimum level is when we have MC=I'(Q), therefore,

5Q=750-10Q, as we clear it for Q we find that

Q=\frac{750}{15}=50, finally as we have that Q is measured in hundreds of ties, the production level that maximizes Silky's profit is 5000 ties.

4 0
3 years ago
Identify the appropriate step in the communication process.
Gnesinka [82]

Answer:

The correct answer is letter "A": Sender encodes message.

Explanation:

Communication is the process of transmitting information from one party to another. The communication process has five (5) steps: <em>encoding, planning, medium, decoding, </em>and <em>feedback</em>. In the encoding step, the idea to be transmitted is schemed in letters, words or symbols without sending them to the channel.

Thus, <em>by writing a recommendation report, Crystal Jenkins is in the encoding stage of communication.</em>

4 0
3 years ago
Growing chocolate is important to West African economies but they do not make as much money as the multinational companies that
kupik [55]

Answer: The name of the ghanaian brand is "57 chocolate"

Explanation:

57 Chocolate belongs to two sisters

Priscilla and Kimberly Addison, the creators of 57 chocolate, made in Ghana by Ghanaians, for Ghanaians. Their chocolates which come in dark, milk, white chocolate, mocha latte and bissap flavours are uniquely packaged in adinkra symbol shapes. and is the pioneer bean to bar chocolate business in Ghana. This venture uses resources grown within the country to create delicious chocolate

7 0
3 years ago
Other questions:
  • Assume a steel company is willing to sell its alloy beams for $400 a piece and produce 100000 units. At a price of 449 they are
    11·1 answer
  • With respect to income from services, which of the following is true?a. The income is always amortized over the period the servi
    13·1 answer
  • Lori and monica are looking at the cans of coffee on display at a local supermarket. they are trying to decide which of two diff
    5·1 answer
  • Your U.S.-based company has recently purchased an old office building where employees are being assigned to work. As you are set
    11·1 answer
  • Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $45,000. If the
    8·1 answer
  • What effect do labor unions have on the unemployment rate? A. Labor unions can significantly increase the unemployment rate when
    12·1 answer
  • Keenan Industries has a bond outstanding with 15 years to maturity, an 8.25% nominal coupon, semiannual payments, and a $1,000 p
    14·1 answer
  • Common methods of alternative dispute resolution include all of the following EXCEPT________.
    7·1 answer
  • ___ is the total sum of benefits a purchasing firm obtains for the price it pays for the marketing offering.
    10·1 answer
  • Which of the following phrases best describes O*NET?
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!