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prohojiy [21]
2 years ago
15

What is the present value of 4360 to be received at the beginning of each of 30 periods discounted at 5% compound interest

Business
1 answer:
Sloan [31]2 years ago
5 0

Answer:

The right solution is "70375.08".

Explanation:

Given that,

Present value,

= 4360

Interest rate,

= 5%

Time period,

= 30

Now,

The present value of inflows will be:

= (1+rate)\times \frac{Present \ value[1-(1+Interest \ rate)^{-time \ period}]}{rate}

= 1.05\times 4360\times \frac{[1-(1.05)^{-30}]}{0.05}

= 4360\times 16.1410736

= 70375.08

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Gabriella strongly prefers a specific brand of gourmet coffee. Since there is only one store in her area that sells her brand, s
omeli [17]

Answer:

A. True

Explanation:

For her it is a specialty good because it not sold everywhere, therefore she makes the extra effort.

7 0
3 years ago
When several alternative investment proposals of the same amount are being considered, the one with the largest net present valu
Likurg_2 [28]

Answer:

The answer is c. present value index

Explanation:

Present value index is the ratio decided by dividing net present value of the project by its require initial net cash outflows.

Once having constraint on selecting investment with positive NPV to be made due to lack of fund, a firm's usually use Present value index for further decision making.

The investment with higher present value index shows that it generates more net cash flow or in other words, more efficient and requires less initial cash outflow, and thus usually be chosen over the other ones with lower present value index.

4 0
3 years ago
Suppose Hyperpolis’s GDP increases by 15% and its inflation rate is 12%, while Superpolis’s GDP increases by 6% and its inflatio
strojnjashka [21]

Answer: c) Both economies grew at the same rate

Explanation:

The faster growing economy would be the one that saw a greater increase in Real GDP than the other.

Real GDP growth = Nominal GDP growth - Inflation growth.

Hyperpolis Real GDP growth = 15% - 12%

Hyperpolis Real GDP growth = 3%

Superpolis Real GDP growth = 6% - 3%

Superpolis Real GDP growth = 3%

<em>Both countries grew at the same rate of 3%. </em>

7 0
3 years ago
Real GDP per capita is not a perfect measure of the well-being of a country's individual citizens because: Instructions: You may
nasty-shy [4]

Answer:

it does not measure quality-of-life factors ; it does not account for distribution of wealth ; it fails to measure non monetary (home production) activities

Explanation:

Real GDP is the total value of goods & services produced in an economy, during a period of time. But it is not correct measure of welfare level.

  • It does not measure non monetary production, like hobby production eg kitchen gardening, self made paintings, music. But, they increase welfare
  • It does not take into consideration the qualitative factors affecting welfare like pollution, crime & literacy. Externalities cause extra benefit or harm to welfare level, but are excluded from GDP.
  • Inequitable distribution of  per capita (average) GDP increases rich poor standard of living divide. So, the distribution effect ignored make GDP an inapt measure of average welfare level.

Real GDP adjusts the value of goods & services for price change (Inflation), it is a correct measure of increase in real flow of goods & services. GDP & health positive correlation is a favouring point for GDP as a measure of welfare. So, these options are incorrect.

4 0
2 years ago
Carlos recognizes that if he visits his aunt on Saturday, he'll miss his brother's football game. The economic principle best em
mr Goodwill [35]

Answer: Opportunity cost

Explanation:

The economic principle best embodied by this story is the opportunity cost. Opportunity cost is the cost of what one forgoes when one takes an alternative decision.

In this case, the opportunity cost of him visiting his aunt will be the lost opportunity which he could have used to watch his brother play.

3 0
3 years ago
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