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Tom [10]
3 years ago
11

In the text, we supposed a college education raised a person's wage by $30,000 per year, from $40,000 to $70,000. Assume the rel

evant interest rate is 3%, there is no growth in wages, and you are expected to retire at 65 years old after you graduate high-school. (a): Suppose you are a 18 year old graduating high school senior deciding whether or not to go to college. What is the present discounted value of your labor earnings if you chose not to attend college
Business
1 answer:
gavmur [86]3 years ago
5 0

Answer:

$1,010,668

Explanation:

if you choose not to attend college, you should be working for 65 - 18 = 47 years

your expected annual salary is $40,000

the present value of your future earnings = $40,000 x PV annuity factor

PV annuity factor = = [1 - 1/(1 + i)ⁿ] / i = [1 - 1/(1 + 0.03)⁴⁸] / 0.03 = 25.2667

present value of future earnings = $40,000 x 25.2667 = $1,010,668

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What is the difference between a budget and a standard?
cricket20 [7]

Answer:

B

Explanation:

Standard is used for unit projection and unit prices of a product, while Budget is used for total projection in both price and Total units of a product.

5 0
3 years ago
. For a new product, sales volume in the first year is estimated to be 50,000 units and is projected to grow at a rate of 7% per
Alecsey [184]

Answer:

The NPV value of the profit over the three year period is $9,900,966.32  

Explanation:

The NPV of the profit over three year period was computed by first of all incorporating all growth assumptions relating to sales volume,sales price,variable and fixed costs.

With the assumptions incorporated , I calculated the sales revenue,variable and fixed costs per year,hence the profit figure is sales less variable and fixed costs.

Finally I discounted the profit to present using the formula 1/(1+r)^N,where r is the rate of 4% and N the relevant year.

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5 0
3 years ago
Complete this analogy: The computer is to hardware as a productivity program is to _____.
nikitadnepr [17]

Answer:

3. Software

Explanation:

7 0
3 years ago
Monitoring Central Bank Intervention1) How can your business be affected if the Fed attempts to strengthen the dollar in the for
skad [1K]

Answer:

1) if the FED decides to strengthen then dollar, it will make US exports more expensive and imports cheaper. That will cause net exports to decrease, i.e. there will be less exports and more imports.

A strengthening of the US dollar helps importing companies because they will buy cheaper goods from abroad and will be able to sell them at higher domestic prices. On the other hand, exporting companies will be hit because hey loss competitiveness since their products will be more expensive.

2) If the FED decides to weaken the US dollar, the opposite will happen. Exporting companies will be favored, while importing companies will be hurt. The country will start to export more and import less.

3) Generally, the FED intervenes market through its money supply policy. When the interest rate increases or the money supply increases, the value of the US dollar will tend to lower. Even if expansionary monetary policy doesn't have an immediate impact, the expectations do matter. If people expect a devaluation of the US dollar, they will start to buy foreign currencies, which in turn will end up devaluating the US dollar. It is a self-fulfilled prophecy.

Another way the FED impacts businesses is through the interest rate. Lower interest rates will increase both domestic and foreign investment in the US.

7 0
3 years ago
Brenda identified all of the pure loss exposures her family faces. Then she analyzed these loss exposures, developed a plan to t
olya-2409 [2.1K]

Option D

The process Brenda conducted is called personal risk management.

<h3><u>Explanation:</u></h3>

Personal Risk Management is the means of implementing risk management systems to the requirements of unique consumers. It is the manner of recognizing, including, and managing personal risk, accompanied by performing the execution plan and monitoring variations over time.

Pure risks are insurable because their prospects can be estimated accurately suitable for the risk to be quantified, which indicates it can be valued, purchased, and traded. Personal Risk Management is based on the idea that the kind of an insurance program should nevermore be limited than the nature of what it guards.

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