1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Alika [10]
4 years ago
13

The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $35,000 per year fo

rever. If the required return on this investment is 4.7 percent, how much will you pay for the policy? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
lesya [120]4 years ago
3 0

Answer:

You will pay $744,680.85 for the policy

Explanation:

Step 1

Since cash flow is a perpetuity, we can derive the following expression;

P.V=C/r

where;

P.V=present value of the investment

C=cash flow

r=annual rate of return

In our case;

P.V=unknown

C=$35,000

r=4.7%=4.7/100=0.047

replacing;

P.V=35,000/0.047

P.V=744,680.8511

744,680.8511 rounded off to 2 decimal places=744,680.85

You will pay $744,680.85 for the policy

You might be interested in
The FTC regulates businesses to prevent price-fixing and similar monopolistic practices. What is the main reason the FTC discour
Irina18 [472]
The answer is B, Monopolies limit competition, which unbalance forces that rregulate the market system
7 0
3 years ago
Read 2 more answers
What is the BEST reason to review your credit reports annually?
FrozenT [24]

Answer:

The correct answer is letter "C": To see if there are any errors or fraudulent activity.

Explanation:

Credit reports provide a summary of all the credits an individual has. It is a good practice to request a credit report at least once a year to find out if there is <em>fraudulent activity</em>. Banks usually inform account holders about fraudulent activity but in some other cases, such as in identity theft, the affected person does not realize what is happening until collection is made for the debt that person is supposed to have.

8 0
3 years ago
How do businesses and the society benefit from marketing?
Verdich [7]

Answer:

Marketing stimulates a competitive economy, promotes products and services, and targets consumers who are most likely to become purchasers. Higher sales for a company that employs effective marketing strategies translate into expansion, job creation, higher government tax revenue, and eventually, overall growth.

HAVE A GOOD DAY!

5 0
4 years ago
Omni Corporation's accumulated depreciation—equipment account increased by $5,300, while $3,400 of patent amortization was recog
dmitriy555 [2]

Answer:

Cashflow from Operating Activities

Net Income                                                                 $120,400

Adjastment for Non-Cash Items

Depreciation                                                                  $5,300

Amortization                                                                   $3,400

Adjastments of Items appearing elsewhere

Loss from the sale of land                                            $4,000

Net Cash flow from operating activities                    $133,100

Explanation:

Net Income is reconciled in the cashflow statement via the indirect method. Its is adjasted for Non-Cash Items, Items appearing elsewhere in the cashflow statement and Working Capital Movements

8 0
3 years ago
Universal Travel Inc. borrowed $497,000 on November 1, 2018, and signed a 12-month note bearing interest at 4%. Interest is paya
never [62]

Answer:

Dec 31, 2018

Interest expense                        3313.33 Dr

    Interest Payable                           3313.33 Cr

Explanation:

The note interest is payable at an annual rate of 4%. The interest will be paid at maturity however, an adjusting entry will be made on December 31, 2018 following the accrual basis of accounting to record the interest expense that relates to the period from November to December of 2018. The interest expense will be debited and as the interest will be paid at maturity, interest payable will be credited.

Interest expense = 497000 * 0.04 * 2/12   = $3313.33

7 0
3 years ago
Other questions:
  • Define business cycle
    11·2 answers
  • The difference between a merger and an acquisition is
    14·1 answer
  • All of the following statements are true of the soup industry EXCEPT: Select one: a. There is high growth in "convenience" soup
    6·1 answer
  • A binding minimum wage will increase the income of Question 7 options: A. all workers. B. potential workers seeking employment.
    15·2 answers
  • Eddie Falco went to a grocery store to buy his favorite brand of ice cream. However, the store was temporarily out of that brand
    13·1 answer
  • LP Gas has a cost of equity of 16.31 percent and a pretax cost of debt of 7.8 percent. The debt-equity ratio is .56 and the tax
    8·1 answer
  • Barnes and Miller Manufacturing is trying to determine the equivalent units for conversion costs with 10,000 units of ending wor
    10·1 answer
  • f the company estimates that it will need 55,480 pounds of raw material to satisfy production needs in March, then the raw mater
    8·1 answer
  • Jordan loves creating short films using his phone camera and small posable figures. He has learned how to edit the videos so tha
    5·2 answers
  • Is water wet or....?
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!