Answer:
A) NPV= - $428,888.89 B) Company would break Even if g = 5.68%
Explanation:
Hi, we have to bring to present value all the inflows and outflows of cash, this is the formula to use and the math of it.
![NPV=-Invesment+\frac{CashFlowYr1}{(return-growth)}](https://tex.z-dn.net/?f=NPV%3D-Invesment%2B%5Cfrac%7BCashFlowYr1%7D%7B%28return-growth%29%7D)
![NPV=-1440000+\frac{91000}{(0.12-0.03)} = -428888.89](https://tex.z-dn.net/?f=NPV%3D-1440000%2B%5Cfrac%7B91000%7D%7B%280.12-0.03%29%7D%20%3D%20-428888.89)
The question says that "at what constant growth rate would the company just break even..." and well, a NPV=0 is not precisely break even, actually, it means that the company is obtaining exactly what is asking for any investment, but let´s assume that the question was, what should the growth rate be for the company to accept this project?. So we have to solve the first equation for "g", that is:
![g=\frac{(Invesment*return-CashFlowYr1)}{Invesment} =\frac{(1440000*0.12-91000)}{1440000} =0.0568](https://tex.z-dn.net/?f=g%3D%5Cfrac%7B%28Invesment%2Areturn-CashFlowYr1%29%7D%7BInvesment%7D%20%3D%5Cfrac%7B%281440000%2A0.12-91000%29%7D%7B1440000%7D%20%3D0.0568)
So the constant growth rate has to be at least 5.68% for the company to accept this project (NPV=0)
Best of luck
Answer:
The correct answer is letter "A": capital turnover or sales margin.
Explanation:
Return on Investment, or ROI, measures the amount of return on an investment relative to the cost of investment. The return of an investment is divided by its cost to calculate ROI. The result is expressed as a percentage or as a ratio. Investments with positive ROI are likely to be successful while those with negative figures are possible to end up in losses.
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<em>To increase a division's ROI, the firm can increase the capital turnover (capital assets that allow the company to profit) or the sales margin (the difference between costs and the net profit of selling a unit of a product).</em>
Answer:
Increase, Decrease
Explanation:
A decrease in the supply results in many buyers competing for very few goods. If the demand is constant, the quantity supplied and price have an indirect relationship. A decrease in the volume of supplied results in an increase in price. Many buyers will be competing for a few products causing the equilibrium price to increase.
A decrease in supply will cause the quantity available for buyers to buy to decline. Consequently, the volume purchased will be fewer. Equilibrium quantity will, therefore, decrease.
There are at least 3 reasons why an artist would represent their ideas in abstract form. First, they may try to show the essential form or shape of the subject matter as in some paintings of the Group of Seven or Emily Carr in Canada in portraying snowy mountains or forests for example. Then, they may show disfigured people and horses screaming their outrage and dismay at being bombed like the painting of Guernica by Picasso to show outright rejection of the terrible bombing of Guernica in Spain by the Nazis in WWII. Also, color in an abstract painting can show the emotions of the painter such as in dark forests by Emily Carr to capture the feeling of being inside a dense forest of being closed in yet surrounded by wonderful vegetation.
If Inez is not satisfied with the painting by Josh, Inez does not have to accept the portrait or pay Josh any money. Inez does not have to pay Josh at all.