Answer:
The manager should pick project B
Explanation:
To determine what decision the manager should make, the NPV of both projects should be calculated.
Net present value is the present value of after tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator
NPV for project A
Cash flows:
Year 0 = $-335,000
year 1 = $140,000
year 2 = $150,000
year 3 = $100,000
I = 6%
NPV= $14,536.87
NPV for project B
Cash flows:
Year 0 = $-365,000
year 1 = $220,000
year 2 = $110,000
year 3 = $150,000
I = 6%
NPV= $66,389.67
Both projects are profitable but because the firm uses capital rationing , the manager has to pick the now profitbale project, which is project B.
To find the NPV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Answer:
$2,730,000
Explanation:
The opening cash balance is netted off the cash flows from all activities namely; Operating, investing and financing activities to get the closing cash balance.
The operating activities includes elements such as net income, depreciation and amortization, changes in working capital etc.
Given;
Net income = $2,500,000
Depreciation = $160,000
accounts receivable decrease = $350,000 (inflow of cash)
accounts payable decrease = $280,000 (outflow of cash)
net cash provided by operating activities using the indirect approach
= $2,500,000 + $160,000 + $350,000 - $280,000
= $2,730,000
Answer:
I think is b.
Explanation:
or d but double check just from background i eliminate a and c
Answer:
<h2>Spending on infrastructure projects is an example of <u>Discretionary Fiscal Policy</u> aimed at increasing real GDP and employment.</h2>
Explanation:
- A discretionary fiscal policy basically refers to the manipulation or adjustment of various fiscal instruments by the government such as public taxes and government spending.
- The aim of discretionary fiscal policy is to adjust the overall macroeconomic condition in any country based on the existing or current situation or scenario.
- Now,infrastructural spending is part of fiscal policy or instrument to adjust the macroeconomic condition of the country as reflected by necessary modification in the GDP and employment level.Hence, higher infrastructural spending by the government would expectedly increase the residential and commercial construction projects in the country thereby,enhancing the GDP and the employment level in the country and boost the overall economy.
Answer:
The correct answer is option d.
Explanation:
A monopoly is a market structure where there is a single firm in the market with no close substitutes. The firm is a price maker. There is high barriers to entry in the market.
Similar to monopoly other imperfect competition such as monopolistic competition and oligopoly also have barriers to entry, and are price makers. But the firms in such markets have different demand curve than the market demand curve.
But in a monopoly there is only single firm, so the market demand curve is the same as individual firm's demand curve.
