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2 years ago

A firm is deciding whether or not to complete the building of a new office.

Business

1 answer:

kirill115 [55]2 years ago

8 0

The relevant cost of building an office building is $9 million.

The calculation of the relevant cost of building an office building is as follows:

= Sale value of partially completed building and land + additional labor & material required

= $4 million + $5 million

= $9 million

Therefore we can conclude that the relevant cost of building an office building is $9 million.

Learn more about the building here: brainly.com/question/24285028

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Answer:

1. b.Excess Supply

2. e.Equilibrium Quantity

3. c.Equilibrium

4. a.Equilibrium Price

5. d.Excess Demand

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2 years ago

Lester's is a globally diverse company with multiple divisions and a cost of capital of 15.8 percent. Med, Inc., is a specialty

eimsori [14]

Answer:

both companies should invest because the NPV of both companies are positive

Explanation:

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

Only projects with a positive NPV should be accepted. A project with a negative NPV should not be chosen because it isn't profitable.

When choosing between positive NPV projects, choose the project with the highest NPV first because it is the most profitable.

Cash flow in year 0 = - $8.4 million

Cash flow in year 1-7 = $2.2 million

NPV of Lester with I of 15.8% = 0.54 million

NPV of Med Inc with I of 13.7% = 1.12 million

To find the NPV using a financial calculator:

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

0.54

1.12

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2 years ago

The following costs were for Optimal View Inc., a contact lens manufacturer: Output Fixed Cost Variable Cost Total Costs 270 $ 5

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Answer:

Per unit total cost $49.00

Explanation:

The per unit total cost is as follows;

Particulars Total Costs Output

High level $21,300 420

Low level $15,300 270

Difference $6,000 150

Unit variable cost 40 ($6000 ÷ 150)

Fixed cost $4,500 ($21,300 - (420 × 40) )

Total cost at 500 lenses $24,500 ($4,500 + (500*40))

Per unit total cost $49.00 ($24,500 ÷ 500)

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2 years ago

Home Value Inc., Max Cart Inc., and Nice Necessities Inc. are three consumer-product retailing companies. Their products consist

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Answer:

D. Any advantage that one firm has will be short-lived.

Explanation:

With the three firms all producing the same product with similar resources in their production and distribution of their products, any advantage that a firm has over the others if any would not last long at all. This is because each firm is using similar technique in the same location. Hence, there's nothing special about one of the firms over the others.

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3 years ago

Time Value of Money: Basics Using the equations and tables in Appendix 25A this chapter, determine the answers to each of the fo

kow [346]

Answer:

Present value (PV) = $3,000

Interest rate (r) = 6% = 0.06

Number of years (n) = 2 years

Future value (FV) = ?

FV = PV(1 + r)n

FV = $3,000(1 + 0.06)2

FV = $3,000(1.06)2

FV= $3,000 x 1.1236

FV = $3.370.80

Explanation:

In this case, there is need to compound the present value for 2 years at 6% interest per annum. The formula to be applied is the formula for future value of a lump sum (single investment).

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2 years ago