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
allsm [11]
3 years ago
7

Imprudential, Inc., has an unfunded pension liability of $800 million that must be paid in 21 years. To assess the value of the

firm's stock, financial analysts want to discount this liability back to the present. If the relevant discount rate is 5.5 percent, what is the present value of this liability
Business
1 answer:
Sunny_sXe [5.5K]3 years ago
5 0

Answer:

PV= $259.89 million

Explanation:

Giving the following information:

Future Value= $800 million

Number of periods= 21 years

Relevant discount rate= 5.5 percent

<u>To calculate the present value, we need to use the following formula:</u>

PV= FV/(1+i)^n

PV= 800/1.055^21

PV= $259.89 million

You might be interested in
In 1972, one could buy a bag of chips, a pound of hamburger, a package of buns, and a small bag of charcoal for about $2.50. If
Rainbow [258]

Answer:

a. 65 in 1972 and 156 today

Explanation:

The relationship between CPI should be the same as the prices:

price today / price 1972 = CPI today / CPI 1972

          6      /       2.50      = 2.4

Now we divide the given CPI and look for the correct answer:

<em>a) 156/65 = 2.4</em>

b) 145.8 / 90 = 1.62

c) 160/75 = 2.1333333

d) 150/60 = 2.5

the first option matches the relationship between prices thus, is the correct one.

5 0
2 years ago
Hammerhead Inc. uses practical capacity as the denominator to set the cost of supplying capacity and for the current period the
bogdanovich [222]

Answer:

the value of the manufacturing resources not used is $252,000

Explanation:

The computation of the value of the manufacturing resources not used is shown below

= (practical capacity - number of units produced) ×  budgeted cost per unit of supplying capacity

= (10,000 units - 4,000 units) × $42

= 6,000 units × $42

= $252,000

Hence, the value of the manufacturing resources not used is $252,000

7 0
3 years ago
Individuals may find it more advantageous to purchase claims from a financial intermediary rather than directly purchasing claim
SSSSS [86.1K]

Answer:

The correct answer is I and II.

Explanation:

Individuals may find it more advantageous to purchase claims from a financial intermediary rather than directly purchasing claims in capital markets because of several reasons.  

The financial intermediaries such as commercial banks, mutual funds, insurance companies, pension funds, etc. are more diversified than individual investors. They provide a number of options for borrowing and lending.  

These intermediaries work on a larger scale than an individual investor. They are thus able to reap the advantages of economies of scale which an individual investor cannot.

8 0
3 years ago
Blue Spruce Corp. reported net income of $194,740 for 2022. Blue Spruce Corp. also reported depreciation expense of $36,900 and
Svetlanka [38]

Answer:

Blue Spruce Corp

Statement of Cash Flows for the year ended December 31, 2022

Operating activities section:

Net income                                          $194,740

add non-cash flow items:

    Depreciation expense                      36,900

    Loss on disposal of plant assets     54,030

Adjusted operating income             $285,670

Working capital changes:

Increase in accounts receivable         (15,650)

Increase in accounts payable              15,880

Increase in prepaid expenses             (4,250)

Net cash from operating activities $281,650

Explanation:

a) Data and Calculations:

Reported 2022 net income = $194,740

Depreciation expense = $36,900

Loss on disposal of plant assets = $54,030

Increase in accounts receivable = $15,650

Increase in accounts payable $15,880

Increase in prepaid expenses $4,250

b) The operating activities section is one section of the Statement of Cash Flows.  It shows the cash inflows and outflows from Spruce's normal business activities.  Other sections of Spruce's Statement of Cash Flows that show activities outside operating activities are the investment activities section and financing activities.

7 0
2 years ago
Question 1 Saved
Nadusha1986 [10]

Answer: Businesses sell goods and services in product markets.

Explanation: Circular flow diagram shows the flow of goods and services from Firms to the Households and Factors of production from the Households to the Firms. The firms money from the sale of those goods and services and the households get factor payment.

Thus, Business are sell goods and services in product markets in a circular flow diagram.

3 0
3 years ago
Other questions:
  • April segal and her sister obtained a 25 year , $120,000 loan for their new home. The interest rate is 7.5 percent and their mon
    6·1 answer
  • Zahara Smith is wondering how she can make her check stretch enough to afford her monthly cable, water, grocery, and cell phone
    14·2 answers
  • The holder of a $1,000 face value bond can exchange the bond any time for 25 shares of stock. Then the conversion ratio:
    9·1 answer
  • On November 10 of the current year, Flores Mills provides services to a customer for $8,000 with credit terms 2/10, n/30. The cu
    13·1 answer
  • mackenzie burrows $300 000 from the bank on a 30 year mortgage. she is given an interest rate of 5.125% apr. how much in total i
    12·1 answer
  • A marketing professor wanted to do everything possible to ensure that her students understood her lectures. Accordingly, she use
    13·1 answer
  • In the context of business ethics,. Involves clear misconduct, unline an ethical dilemma that involves a conflict
    11·1 answer
  • Agency problems are most likely to be associated with?
    6·1 answer
  • Explain the three actions the fed could take to reduce the trade deficit in the united states, and explain carefully how these a
    14·1 answer
  • for a monopolist, the market demand curve: a is also the demand for the monopolist's product. b is not important since the monop
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!