Answer:
- <u><em>Option B. $1,025 a month for 10 years.</em></u>
Explanation:
Calculate the present value of each option:
Formula:
![PV=C\times \bigg[\dfrac{1}{r}-\dfrac{1}{r(1+r)^t}\bigg]](https://tex.z-dn.net/?f=PV%3DC%5Ctimes%20%5Cbigg%5B%5Cdfrac%7B1%7D%7Br%7D-%5Cdfrac%7B1%7D%7Br%281%2Br%29%5Et%7D%5Cbigg%5D)
Where:
- PV is the present value of the constant monthly payments
- r is the monthly rate
- t is the number of moths
<u>1. Option A will provide $1,500 a month for 6 years. </u>
![PV=$\ 1,500\times \bigg[\dfrac{1}{(0.005\overline 6}-\dfrac{1}{0.005\overline 6(1+0.005\overline 6)^{(6\times12)}}\bigg]](https://tex.z-dn.net/?f=PV%3D%24%5C%201%2C500%5Ctimes%20%5Cbigg%5B%5Cdfrac%7B1%7D%7B%280.005%5Coverline%206%7D-%5Cdfrac%7B1%7D%7B0.005%5Coverline%206%281%2B0.005%5Coverline%206%29%5E%7B%286%5Ctimes12%29%7D%7D%5Cbigg%5D)
<u>2. Option B will pay $1,025 a month for 10 years. </u>
![PV=$\ 1,025\times \bigg[\dfrac{1}{(0.005\overline 6}-\dfrac{1}{0.005\overline 6(1+0.005\overline 6)^{(10\times12)}}\bigg]](https://tex.z-dn.net/?f=PV%3D%24%5C%201%2C025%5Ctimes%20%5Cbigg%5B%5Cdfrac%7B1%7D%7B%280.005%5Coverline%206%7D-%5Cdfrac%7B1%7D%7B0.005%5Coverline%206%281%2B0.005%5Coverline%206%29%5E%7B%2810%5Ctimes12%29%7D%7D%5Cbigg%5D)
<u>3. Option C offers $85,000 as a lump sum payment today. </u>
<u></u>
<h2 /><h2> Conclusion:</h2>
The present value of the<em> option B, $1,025 a month for 10 years</em>, has a the greatest present value, thus since he is only concerned with the <em>financial aspects of the offier</em>, this is the one he should select.
Answer:
True
Explanation:
Contracts should be in writing because this guarantees that all the terms of the agreement are documented and the responsabilities of each party are stated. Also, contracts that involve the sale of goods with a value higher than $500 have to be in writing to be enforceable. So, according to this and considering that the total cost of the lighting is $5,000, it is true that the contract needs to be in writing.
Answer: Please refer to Explanation.
Explanation:
a. The company regularly follows up with customers who pay late.
This is GOOD.
Cash Management Strategy - Collection of Accounts Receivables on time to maintain cash balance.
b. Excess cash is put into short-term investments to earn extra income.
This is GOOD.
Cash Management Strategy - Earning extra income on idle cash by investing in short-term liquid investments.
c. Cash receipts and cash payments are regularly planned and reviewed.
This is GOOD.
Cash Management Strategy - Cash Planning to establish a correct balance between payments and receipts.
d. Rarely used equipment is rented rather than purchased.
This is GOOD
Cash Management Strategy - Saving money by spending economically only when needed.
e. Bills are paid as soon as they are received.
This is BAD
Cash Management Strategy - Paying bills when due to ensure that operating cash balance is maintained at a healthy level.
If you need any clarification do comment.
Cheers.
Answer:
65 firms will be in the industry at the new long run equilibrium
Explanation:
in the long run the P=ATC
quantity before the change is
200 = 1000-4Q
4Q = 800
Q= 200
each firm output = Q/number of firms = 200 / 50
q = 4
new quantity is
200 = 1240-4Q
4Q = 1040
Q = 260
number of firms=new Q/q
=260/4 = 65
the number of firms is 65 in the long run.
