Possibly increase, possibly decrease, or possibly remain constant.
Answer:
B) $90,000
Explanation:
The market value of the unlevered equity can be calculated using the following formula:
Expected value = Σpx
Where:
p = the probability of each outcome
=50% in this case for both weak and strong economy.
x = the present value of cash flow for each outcome which is $90,000 in case of weak economy and $117,000 in case of strong economy.
Expected value= 0.50(90,000(1+15%)^-1)+0.50(117,000(1+15%)^-1)
=0.50(78,260.87)+0.50(101,739.13)
=$90,000
So the answer is B) $90,000
Answer:
The algebraic formulation of the constraint is 4X+2Y ≤ 100
Explanation:
The algebraic formulation of the constraint is shown below:
Given that
The number of hours taken per unit of x is 4 hours
And the number of hours taken per unit of x is 2 hours
And, the maximum hours available is 100
Now based on the above information
The algebraic formulation of the constraint is
= 4X+2Y ≤ 100
hence, the same is to be considered
Answer:
$444,444.44
Explanation:
Larry's life insurance corporation is trying to sell an investment policy that will pay you and your heirs a total amount of $32,000 per year
The required return on this investment is 7.2%
= 7.2/100
= 0.072
Since the cash flow is a perpetuity then, the amount that will be paid for the policy can be calculated as follows
PV= C/r
= $32,000/0.072
= $444,444.44
Hence the amount of money that will be paid for the policy is $444,444.44
