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AlladinOne [14]
3 years ago
13

Your division is considering two projects with the following cash flows (in millions): 0 1 2 3 Project A -$31 $7 $12 $22 Project

B -$19 $13 $6 $5 What are the projects' NPVs assuming the WACC is 5%
Business
1 answer:
katrin [286]3 years ago
3 0

Answer:

Project A's NPV = $5.56

Project B's NPV = $3.14

Explanation:

year          project A        project B

0                  -$31                -$19

1                     $7                 $13

2                   $12                 $6

3                  $22                 $5

Project A's NPV = -$31 + $7/1.05 + $12/1.05² + $22/1.05³ = -$31 + $36.56 = $5.56

Project B's NPV = -$19 + $13/1.05 + $6/1.05² + $5/1.05³ = -$19 + $22.14 = $3.14

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Answer:

A. the economy is producing at less than its potential output and has some cyclical unemployment.

Explanation:

Increase in government spending will increase domestic income, only if economy is producing at less than its potential output.

Increase in federal government spending raises the level of 'govt expenditure' in Aggregate Demand. This creates 'Excess Demand' (AD > AS). However, if the economy is at full employment level, i.e all the resources are already best efficiently utilised as per their production potential. Then, the economy can't increase its domestic income more than its full employment (full potential) level. So : Increase in government spending in full employment case, wont increase total production/ income/ employment further ; as the economy is already at full employment & can't increase economic activity beyond that.

3 0
3 years ago
Prepaid Advertising has a debit balance in the Trial Balance section of the worksheet of $1500 and a credit entry of $550 in the
Dmitriy789 [7]
It will be answer choice b
5 0
3 years ago
By nudging the minds and movers of the chief actors of a business, women often occupy a subtle but determining role behind the s
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The correct answer is Chief Emotional Officer.

Explanation:

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3 years ago
g Distinguish between the total U.S. debt and the debt held by the public. Why is the debt as a percentage of GDP more relevant
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Answer:

The total US debt is all the money that the US federal government owes. While the debt held by the public is only the portion of the US debt held by private entities (e.g. private investors or foreign governments).

In the past (around 20 years ago), government debt owned by federal agencies was much higher, over 40%, with social security being the largest debt holder. This is called intragovernmental debt. That means that around 60% of the debt was held by the public. But in recent years this has changed. Currently. intragovernmental national debt has fallen to 23%. This means that the debt hold by the public is more or less 77%.

Even as intragovernmental debt has decreased, the total size of the national debt is not as important as the percentage of the national debt compared to the GDP. Currently, national debt represents 98.3% of the GDP which is the highest level since WWII. This is really something to worry about because the government spends a huge portion of its budget paying interests on existing national debt and the higher it is, the less money available for other expenses. As the national debt increases in relation to the GDP, it is more difficult for the country to pay it back. The said thing is that politicians do not pay for it, taxpayers pay it.

3 0
3 years ago
The following list shows the items and prices for a restaurant order. Calculate the total amount if there is a 7% tax and the cu
Shalnov [3]

Total Amount

Explanation:

Total Amount -  $65.10

1 appetizer: $7.39=7.39

2 entrees: $16.99 each=  2 * 16.99=33.98

1 dessert: $5.29= 5.29

2 drinks: $2.30 each=4.6

cost = 7.39 + 33.98 + 5.29 + 4.6 =$51.26

7% tax = 51.26 * 0.07 = 3.5882

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Total cost = 51.26 + 3.5882 + 10.252 =65.1002

the total amount = $65.1

7 0
3 years ago
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