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Sever21 [200]
3 years ago
7

DYI Construction Co. is considering a new inventory system that will cost $750,000. The system is expected to generate positive

cash flows over the next four years in the amounts of $350,000 in year one, $325,000 in year two, $250,000 in year three, and $180,000 in year four. DYI's required rate of return is 8%. What is the net present value of this project?
$87,417

$96,320

$104,089

$183,472
Business
1 answer:
Oksanka [162]3 years ago
6 0

Answer:

Year Cashflow        [email protected]% PV

$                      $

0 (750,000)             1          (750,000)

1        350,000               0.9259    324,065

2       325,000               0.8573     278,623

3        250,000              0.7938      198.450

4        180,000               0.7350      132,300

                                        NPV         184,438

The correct answer is D. The difference in answers is due to rounding error.

Explanation:

Net present value is the diffrence between initial outlay and present value of inflow. We need to discount the cash inflows for year 1 to year 4 at 8% and then calculate the present value of cash inflows by multiplying the cash inflows by the discount factors. Finally, we will calculate NPV by deducting the initial outlay from the present value of cash inflows.

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Determine which of the following bags of chips of comparable quality has the lowest per-unit cost and, thus, is the best buy.A.
Leto [7]

Answer:

B. Brand B, 10 oz. bag for $3.90

Explanation:

The lowest per unit cost of different brands can be calculated using the following formula

Cost per oz=Cost per bag/number of oz in that bag

Brand A Cost per oz=3.60/8=$0.45

Brand B Cost per oz=3.90/10=$0.39

Brand C Cost per oz=6.50/16=$0.406

Brand D Cost per oz=0.59/1=$0.59

So the answer is B. Brand B, 10 oz. bag for $3.90

5 0
2 years ago
A company produces very unusual CD's for which the variable cost is $ 12 per CD and the fixed costs are $ 30000. They will sell
Aleks04 [339]

Answer:

(1) $30,000 + $12x

(2) $50x

(3) $38x - $30,000

(4) 790 CD's to break even

Explanation:

Given that,

Variable cost = $12 per CD

Fixed cost = $30,000

Selling price = $50 each

Let x be the number of CD's produced,

(1) Total cost function:

C(x) = Fixed cost + Variable cost

      = $30,000 + $12x

(2) Total revenue:

R(x) = Units produced × selling price of each unit

      = $50x

(3) Total profit:

P(x) = R(x) - C(x)

      = $50x - ($30,000 + $12x)

      = $50x - $30,000 - $12x

      = $38x - $30,000

(4) Number of CD's which must be produced to break even:

Total profit = 0

$38x - $30,000 = 0

x = $30,000 ÷ $38

  = 789.47 or 790 CD's to break even.

6 0
3 years ago
All licensees should give earnest money checks to their sponsoring broker immediately who must deposit said earnest money by:___
Lady bird [3.3K]

Answer:

b)the next business day of contract acceptance.

Explanation:

A license which is reffered to as a permit to authority should make sure their sponsoring brokers were given earnest money checks after the contract has been accepted so that it can becomes a legal deal.

It should be noted that All licensees should give earnest money checks to their sponsoring broker immediately who must deposit said earnest money by the next business day of contract acceptance.

8 0
3 years ago
The common stock of Water Town Mills pays an annual dividend of $1.84 a share. The company has promised to maintain a constant d
wel

Answer:

The maximum that should be paid for a share of this stock today is $13.53.

Explanation:

The price of a company's stock which pays a constant dividend through out can be calculated using the zero growth model of the Dividend discount model (DDM). The formula for price of the stock today under DDM's zero growth model is,

P0 = D / r

P0 = 1.84 / 0.136

P0 = $13.529 rounded off to $13.53

3 0
3 years ago
a web retailer has received several negative social media reviews over the past few weeks due to missed shipments of product. wh
Nimfa-mama [501]

This situation shows that control is needed to discover irregularities and errors.

We can arrive at this answer because:

  • A well-established control that evaluates the functioning of a business is essential for the success of an enterprise.
  • That's because the control allows all defective elements of any sector of the company, which may be presenting errors and irregularities, to be quickly detected.
  • This allows these defects to be resolved and eliminated quickly, ensuring a smooth running of the project and high quality of service.

In this case, we can say that a good control system could have identified the problems with the shipments and solved the problem before the customers were dissatisfied.

More information:

brainly.com/question/14411376?referrer=searchResults

3 0
2 years ago
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