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wlad13 [49]
3 years ago
13

You are considering a project which has been assigned a discount rate of 5 percent. If you start the project today, you will inc

ur an initial cost of $4,100 and will receive cash inflows of $2,900 a year for 2 years. If you wait one year to start the project, the initial cost will rise to $4,320 and the cash flows will increase to $3,257 a year for 2 years. What is the value of the option to wait
Business
1 answer:
riadik2000 [5.3K]3 years ago
8 0

Answer:

$361.14

Explanation:

start the project today:

initial outlay = -$4,100

cash flow year 1 = $2,900

cash flow year 2 = $2,900

NPV = -$4,100 + $5,392.29 = $1,292.29

if you start the project in one year:

initial outlay year 1 = -$4,320

cash flow year 2 = $3,257

cash flow year 3 = $3,257

NPV year 1 = -$4,320 + $6,056.10 = $1,736.10

value of option to wait = ($1,736.10 / 1.05) - $1,292.29 = $361.14

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lys-0071 [83]

Answer:

Myro Distributors is a Retailer.

Explanation:

Now, looking at this answer, lets filter out the rest of the options.

A is clearly not correct as the question it self doesn't say anything about Myro producing the goods.

C is somewhat a vague, general answer. Institution? What kind of an institution?

We can't accept D as well. No information in the question lead us to conclude that Myro is a manufacturer.

B on the other hand is a perfect fit. The question itself says that Myro is purchasing from a "Wholesaler".

Retailers purchase goods from wholesalers and sells the products to the final customers at a profit. The key difference between Wholesalers and Retailers is that Wholesalers are not selling to the final customers of a product while retailers sell the product to the final customer. Both are middle men.

In this Scenario, Ink Corp sold the goods to Myro and Myro sold it to Seth right? Now Seth is not selling the printers to anyone, which makes him the final consumer/customer of the product.

3 0
4 years ago
On October 1, 2020 Waterway Industries issued 6%, 10-year bonds with a face value of $8150000 at 104. Interest is paid on Octobe
Nastasia [14]

Answer:

the bond interest expense is $114,100

Explanation:

The computation of the bond interest expense is shown below:

Cash interest payable for 3 months 122,250 ($8,150,000 × 6% × 3 ÷ 12)

Less; AMortized premium for 3 months $8,150 ($8,150,000 × 4% ÷ 10 × 3 ÷ 12)

BOnd interest expense $114,100

Hence, the bond interest expense is $114,100

3 0
3 years ago
Riders reports the following assets and liabilities. Compute the totals that would appear in the corporation’s basic accounting
mylen [45]

Answer:

See below

Explanation:

Assets are the valuables a business owes while liabilities are the items the business owes to third parties.

Form the list provided

<u>Assets are</u>

Bank Balance……… Rwf. 17,000,000

Accounts Receivable……Rwf 12,000,000

Machinery……………      <u>   …Rwf 1,800,000</u>

Total   <u>Rwf 30,800,000</u>

<u>Liabilities are</u>

Accounts Payable……………….Rwf 15,000,000

Bank Claims……………  <u> Rwf 15,800,000 </u>

 Total      <u>Rwf. 30,800,000</u>

8 0
3 years ago
When making scrap or rework decisions, management should consider: (Check all that apply.)a. Revenue from selling defective unit
vlabodo [156]

Answer:

The correct answer is all of the above

Explanation:

Scrap or the rework costs are the costs which is incurred in order to repair the   items that are defective. And the decision to rework or scrap an item or product, ground on the benefits or advantage of the incremental costs.

If the reworked units generate or yield greater advantage or benefit rather than the selling them as scrap, then the decision to rework will be considered.

And if the decision of rework is taken, then the management should consider the incremental costs, revenue or profit from selling the defective units as scarp and the lost profit on selling and making the new units while the rework is performed.

3 0
3 years ago
Read 2 more answers
Decreased interest rates will shift the aggregate demand curve to the _____ and _____ output demanded.
Virty [35]

The aggregate demand curve often shifts to the components of aggregate demand. The Decreased interest rates will shift the aggregate demand curve to the right and increased output demanded.

  • The component that is often shifted are consumption spending, investment spending.

In expansionary monetary policy the central bank often makes the supply of money and loanable funds to increase, this in turn will lowers the interest rate, promoting additional borrowing for investment and consumption, and there shifting aggregate demand right.

The rate of government spending, and often rise.

An aggregate demand curve is known to show the total spending on domestic goods and services at each price level.

Learn more from

brainly.com/question/16876969

7 0
3 years ago
Read 2 more answers
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