Answer: The options are given below:
A. $18.00
B. $1,036.80
C. $2.00
D. $7.20
E. $64.00
The correct option is D. $7.20
Explanation:
From the question above, we were given:
Annual demand = 100,000 units
Production = 4 hour cycle
d = 400 per day (250 days per year)
p = 4000 units per day
H = $40 per unit per year
Q = 200
We will be using the EPQ or Q formula to calculate the cost setup, thus:
Q = √(2Ds/H) . √(p/(p-d)
200=√(2x400x250s/40 . √(4000/(4000-400)
200=√5,000s . √1.11
By squaring both sides, we have:
40,000=5,550s
s=40,000/5,550
s=7.20
Answer:
D. The payback period is less than 2 years.
Explanation:
Discount rate 5%
0 1 2
intital investment -10
cash flow 0 30
Total cash flow -10 0 30
NPV 17.21
IRR 73%
Therefore, The NPV is 17.21 and is positive, the statement is True.
IRR > 50%, Therefore the statement made is True
Accounting rate of return = {[(30 - 10)/10]^(1/2)} - 1
= 41% > 0
Therefore, The statement made is true.
Payback period = 2 years, Therefore the statement made is NOT true.
Answer:
Explanation:
This is an Ordinary Annuity question. You can solve this using a financial calculator. I'm using (TI BA II Plus)
N; duration = 20
I/Y ; interest rate per year = 8.5%
PMT ; recurring annual payment = 70,000
FV; Future value = 0 (In solving annuities, use 0 if not given)
then CPT PV = ?
PV = 662,433.563
Therefore, your friend needs to have $662,433.56
Answer:
d There are gains from trade.
Explanation:
A trade can be defined as the process that typically involves the buying and selling of goods and services between a buyer (consumer) and a seller (producer).
Thus, trade creates an enabling environment that suits a specific service provider or producer of a particular product.
Basically, the interaction of individual choices underlies the fact that there are gains from trade.
This ultimately implies that, as a result of the difference between human needs and wants, there is always an opportunity for various producers to manufacture goods and services to meet the needs or requirements of these customers.
