Answer:
First Offer
Present value = $60,000
Second Offer
PV = Down payment + A<u>(1 -(1 + r/m)</u>-nm
r/m
PV = $10,000 + $6,000(<u>1- (1+ 0.06/2</u>))-5x2
0.06/2
PV = $10,000 + $6,000(<u>1 - (1 + 0.03</u>))-10
0.03
PV = $10,000 + 6,000<u>(1 - (1.03)</u>)-10
0.03
PV = $10,000 + 6,000(8.5302)
PV = $61,181
The difference between the two present values
= $61,181 - $60,000
= $1,181
Explanation:
The present value of the cash payment is $60,000. The present value of the second offer is the down payment plus the present value of semi-annual payments. We need to use the present value of annuity formula so as to determine the present value of semi-annual payments. Then. we will deduct the present value of the first offer from the present value of the second offer in order to obtain difference in present values.
Answer:
Contrarian
Explanation:
In this case, Petulia is following the contrarian investment style. Those who follow this style, invest contrary to prevailing market trends (hence the name), by buying when other are selling, and selling when others are buying.
Petulia is a contrarian because instead of selling stock during the downward trend, she opted to buy stock instead, hoping for a rise in the market in the short, or in the long-term.
Answer:
A. $20,000
Explanation:
For computing the goodwill amount we have to apply the formula which is shown below:
= Required capital - actual capital
where,
We know that David invested $50,000 for one-fifth interest
So, Required capital = David investment amount × 5
= $50,000 × 5
= $250,000
And, the actual capital would be
= Allen capital + Daniel capital + David investment
= $140,000 + $40,000 + $ 50,000
= $230,000
So, the goodwill would be
= $250,000 - $230,000 = $20,000
Answer:
True
Explanation:
Before a consumer makes a decision to buy a product, several factors can affect him. Two distinct factors are the attitude of others and unexpected situational factors. When the customer notices that a lot of people around him have a negative disposition or opinion about a product, they are likely to be discouraged from buying that product.
This is even more likely to happen if the consumer lacks enough motivation to buy that product. So the attitude of others can affect the buyer's intention which is his motivation and the final decision to purchase that product.