Listening involves understanding what is heard true false ?

You are analyzing a project with an initial cost of £130,000. The project is expected to return £20,000 the first year, £50,000

Mashutka [201]

Answer: Net Present Value = -$19,062

Explanation:

First, we'll compute the PV for the respective years

Present Value (Year-1)

= $0.6211 \times [1 + (0.055 - 0.06)]^{1}$

=0.6179945

Present Value (Year-2)

= $0.6211 \times [1 + (0.055 - 0.06)]^{2}$

=0.614904528

Present Value (Year-3)

= $0.6211 \times [1 + (0.055 - 0.06)]^{3}$

=0.611830005

Now, we'll compute the Cash Flow for the respective years

Cash Flow (Initial)

= $-130,000\times (\frac{1}{0.6211} )$

= -$209,306.07

Cash Flow (Year-1)

= $20,000\times (\frac{1}{0.61799} )$

=$32,362.75

Cash Flow (Year-2)

= $50,000\times (\frac{1}{0.61490} )$

=$81,313.44

Cash Flow (Year-3)

= $90,000\times (\frac{1}{0.611830} )$

=$147,099.68

Net Present Value:

= -$209,306.07 + ($32,362.75/1.141)+ ($81,313.44/1.142) +($147,099.68/1.143)

= -$209,306.07 +$28,388.38 + $62,568.05 + $99,288.10

= -$19,062

3 0

3 years ago

Anthony, a self-employed plumber, makes a maximum contribution to a SEP for his employee, Debra. Debra's compensation is $40,000

aksik [14]

Answer:

$10,000

Explanation:

The maximum contribution you can made to SEP shall not exceed the lower of the following two limits for 2020:

1. 25% of total compensation paid to employee.

2. $57,000

By applying the above rule to the given scenario in question, the maximum contribution allowed by the Anthony to be made to SEP for Debra shall not exceed:

25% of total compensation=25%*40,000=$10,000

7 0

3 years ago

Suppose a commercial bank has checkable deposits of $60,000 and the legal reserve ratio is 25 percent. If the bank's required an

MAXImum [283]

Answer: $30000

Explanation:

Based on the information given in the question, the required reserve will be:

= $60000 × 25%

= $15000

Since the bank's required and excess reserves are equal, then the excess reserve will be $15000.

Therefore, the actual reserves will be:

= Required reserve + Actual reserve

= $15000 + $15000

= $30000

6 0

3 years ago

Jenny wants to open a savings account to begin saving to buy a house. Which institution will most likely provide her with the be

soldi70 [24.7K]

The answer is B) Credit Union

3 0

3 years ago

Read 2 more answers

After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of direct

kondor19780726 [428]

Number of shares: 410,000

Share price: $47

IF THE COMPANY USES STRAIGHT VOTING:

STEP 1: If the company uses straight voting, then the number of shares it should own would be half of the shares plus one share, in order to guarantee that the enough votes are received to win the election.

Number of shares needed = (Number of shares available for voting ÷ 2) + 1

Number of shares needed = (410,000 ÷ 2) + 1

Number of shares needed = 205,001

STEP 2: Total cost will be the product of share price and number of shares needed.

Total Cost = Share Price × Number of shares needed

Total Cost = $ 47 × 205,001

Total Cost = $ 9,635,047

<u>It will cost $9,635,047 if the company uses straight voting.</u>

IF THE COMPANY USES CUMULATIVE VOTING :

STEP 1: If the company uses cumulative voting, you need 1/(N+1) percent of stock plus one share to get maximum number of votes to win the election.

Percent of stock needed = [1 ÷ (N + 1)] * 100

Percent of stock needed = [1 ÷ (3 + 1)]* 100

Percent of stock needed = (1 ÷ 4) * 100

Percent of stock needed = 25%

So the number of shares purchased = (410,000 × 25%)

Number of shares purchased = 102,500

Total Cost = Number of shares purchased × Share Price

Total Cost = 102,500 × $47

Total Cost = $4,817,500

It will cost $4,817,500 if the company uses cumulative voting.

6 0

3 years ago