Answer:
(a) Fixed cost = $2000 + $180 (15*12) = 2180
(b) Unit price = $4 + $0.5 (price increase) = $4.5
(c) Unit variable cost = $3
(d) First option
(e) Second option
Explanation:
For (d) we have, first option gives (1800) as 200*(4-3) -2000= -1800 and second option give (1880) as 200*(4.5-3) – 2180.
So, he’d prefer first option because of less loss associated with it.
For (e) we have, first option gives (1300) as 700(4-3) -2000 = -1300 and second option gives (1130) because 700(4.5-3) – 2180 = -1130.
So, he would prefer second option because of less loss associated.
Because Dr. King and James and John are all civil rights activists.
Civil rights activists protest against something that is not right.
~~~ Catal Hoyuk ~~~
you'll get hit with a failure-to-file penalty, which starts at 5% of however much you owe, maxing out at 25% of your tax bill. If you wait more than 60 days to file, you're charged a $135 fee or 100% of the taxes you owe (whichever is less).
Answer:
b. NPV < 0
Explanation:
The internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.
The decision rule is invest if IRR > required rate of return and don't invest if IRR < required rate of return.
The net present value is the present value of after tax cash flows from an investment less the amount invested.
The decision rule is invest if NPV > 0 and don't invest otherwise.
The payback period measures how long it takes to recover the amount invested in a project from its cumulative cash flows.
There is no set acceptable pay back period. It is usually set at the discretion of firms.
The profitability index is the present value of a projects cash flows divided by the cost of investment.
The decision rule is invest if PI > 1 and don't if its otherwise.
For a project where the initial cash flow is negative and where all subsequent cash flows are positive, the NPV and IRR would agree.
From the question the IRR is less than the required rate of return which means the project shouldn't be embarked on. When the NPV is calculated, the same conclusion should be reached. So, the npv should be less than zero.
I hope my answer helps you
