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denis23 [38]
3 years ago
10

Durango Co. must decide between two investment opportunities. Information about the two opportunities is listed below: Opportuni

ty 1 - Present value of cash inflows is $123,000 and the present value of cash outflows is $112,323. Opportunity 2 - Present value of cash inflows is $14,232 and the present value of cash outflows is $7,232. Which investment yields a higher rate of return?
Business
1 answer:
Alekssandra [29.7K]3 years ago
8 0

Answer:

Opportunity 2

Explanation:

Calculation to determine Which investment yields a higher rate of return

Based on the information given OPPORTUNITY 2 investment yields a HIGHER rate of return reason because the PRESENT VALUE INDEX is 1.968 calculated as :

Rate of return=$14,232/$7,232

Rate of return= 1.968

Which is HIGHER than the present value index of both opportunity 1 and opportunity 3.

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Dynamo Corp. produces annual cash flows of $150 and is expected to exist forever. The company is currently financed with 75 perc
pashok25 [27]

Answer:

$1,500

Explanation:

Relevant data provided

Annual cash flow = $150

Current Stock percentage = 10%

The computation of today value of Dynamo is shown below:-

Today value of Dynamo = Annual cash flow ÷ Current Stock percentage

= $150 ÷ 10%

= $150 ÷ 0.10

= $1,500

Therefore for computing the today value of Dynamo we simply divide the annual cash flow by current stock percentage.

6 0
3 years ago
A Ground Fault Circuit Interrupter (GFCI) is designed to do which of the following?
Ymorist [56]

Answer: Protect people from severe and sometimes fatal electrocution by monitoring for electrical leakage to ground.

Explanation:

The main purpose of a Ground Fault Circuit Interrupter (GFCI) is to ensure that when a person gets electrocuted, the flow of electricity is cut off quickly so that no serious injuries or death occurs.

It works by monitoring the electrical leakage to the ground by checking to see if the current going to and coming from the equipment differ by a certain amount and if it does, the GFCI will interrupt the circuit.

5 0
3 years ago
As the price level declines along the aggregate demand curve, the interest rate is most likely to:___________.
lbvjy [14]

Answer:

a. Decline

Explanation:

Whenever there is a reduction in the price level, this results in gains in the real money supply which eventually moves the LM curve to the right.

Hence, given that, the IS curve has a downward slope, the IS and LM curves will meet at a higher level of income and a lower interest rate.

Therefore, the correct answer, in this case, is Option A: DECLINE

Note LM means Liquidity and Money

While IS means Investment and Savings.

3 0
4 years ago
Which of the following products probably accounted for by a company using a job order costing system? A) facial tissue B) Hershe
natka813 [3]

Answer: D) A custom built house

Explanation:

Job Order Costing determines the cost of each specific good instead of grouping them all together. When making goods that vary in type, this is the best type of costing method to use as it will take into account the unique cost objects used.

Custom built houses will require cost objects that are different from standadized houses. A specific design will have to be used, non standard material and the like will be used as well. This means that when computing cost, it will have to be specific to the needs of the custom house so it is most probable that Job Order Costing was used.

5 0
4 years ago
Prepare entries in a job order cost system and job cost sheets.
Daniel [21]

Answer:

eraDXZ∂fvkm  ≈√≈∫˜µ ƒuktkktukdkuku

Explanation:

4 0
3 years ago
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