Answer:
C. They are impersonal, which can result in dissatisfied customers.
Automated call service systems can help you, but if you have a more in depth question, it can't. The automated voice is impersonal, they don't show any emotional qualities, so they can't say, "sorry that happened to you," or, "sorry for the wait," (etc).
One negative element about automated call answering service systems is that they are impersonal, which can result in dissatisfied customers.
Thus, the correct option is C.
What are automated calls?A pre-recorded voice message is effectively delivered to the customer through an automated phone call. You can record a message, schedule a call, and send it whenever you like to as many recipients as you like.
An electrical device or piece of software that automatically calls phone numbers is known as an automatic dialer (also spelled auto dialer, auto-dialer, and auto dialer). The auto dialer either plays a recorded message or connects the call to a live person after the phone has been answered.
Automated voice calls are phone calls that merely repeat an already prerecorded message to any number of clients at once. Their fondness for them is primarily due to the built-in cloud capabilities.
Computer systems, network devices, or other machinery can operate automatically with the help of a collection of software and hardware components known as automated system operations (ASO).
ASOs make it possible for computer systems to function without a human operator present at the location where the system is deployed.
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Which of the following statements is false?
Millions of people can't afford to make their student loan payment every month.
Our culture accepts student loan debt as normal and sometimes even refers to it as
good debt.
Debt is owing anything to anyone for any reason.
A student loan is an award.
People who take a loan from a bank have the responsibility to:
A. spend all of their savings to pay off the loan as quickly as
possible.
B. pay the full amount of each monthly payment without being late.
C. use the same bank whenever they want to take out another loan.
D. never take out another loan until the first one is paid off.
Answer:
B
Explanation: Just answered it
People who take loan from a Bank have the responsibility to pay the full amount of each monthly payment. Hence, option B is correct.
Rules for Bank LoanThe Person who took loan from Bank has the responsibility to pay the due amount to the bank within the time limit given by the Bank. If a person failed to do so, he is charged with late fees and also it affects his future loan taking perspectives.
Hence, People who take loan from a Bank have the responsibility to pay the full amount of each monthly payment. Therefore, option B is correct.
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Which situation best illustrates the process of capital formation?
A. A pilot tries to save
money by limiting her weekly spending.
B. A banker takes out a high-interest loan to buy a new car.
C. A restaurant server decides to use his savings to buy stock in a
business.
D. A farmer diversifies his crops by growing many different kinds.
Answer: C
Explanation: A.P.E.X
Answer:c
Explanation:
How Much more did the average household spend on appliances, electronics, and furniture when it recieved the 2008 tax rebate?
Answer:
The households spent an average of $91 on durable goods like furniture, appliances, and electronics when they received a tax rebate in 2008.
Explanation:
In 2008, The U.S Federal government made an economic stimulus payment or tax rebate to American households of 90 billion dollars. This made a huge impact on the consumer market as the households spent more of the received payment on goods and services they both wanted and needed.
Sahia company bought a building for 90,000 cash and the land on which it was located for 1,10,000 cash. The company paid a transfer cost of 10,000. Renovation cost on the building were $31,000.1. What would be the net book value of the property (land and building) at the end of year 2?2. Prepare the journal entry to record the purchase of the property, including all relevant expenditures. Assume that all transactions were for cash and that all purchases occurred at the start of the year.3. Compute straight-line depreciation at the end of one year, assuming an estimated 10-year useful life and a $9,000 estimated residual value. Straight-line depreciation 106,000
Answer:
Sahia Company
1. Net book value of the property at the end of year 2 = $217,800.
2. Journal entry to record the purchase:
Debit Property (land and building) $241,000
Credit Cash Account $241,000
To record the acquisition of the property.
3. Straight-line depreciation (on building only) = $11,600.
Explanation:
a) Data and Calculations:
Bought building for cash = $90,000
Bought land for cash = 110,000
Transfer cost = 10,000
Renovation on building = 31,000
Book value of property = $241,000
Depreciation:
Building cost = $90,000
Transfer cost 4,500 ($10,000*90,000/200,000)
Renovation 31,000
Total cost = $125,500
Residual value 9,000
Depreciable value = $116,000
Depreciation per annum = $11,600 ($116,000/10)
a) Land is not subject to depreciation and its value is $115,500 or $110,000 + 5,500 ($10,000*110,000/200,000).
b) The net book value of the property at the end of year 2 is
Building $125,500 - 23,200 = $102,300
Land = 115,500
Net book value of property = $217,800
2. Mason performs services for Isabella. In determining whether Mason is an employee or an independent contractor, comment on the relevance of each of the factors listed below.
a. Mason performs services only for Isabella and does not work for anyone else.
b. Mason sets his own work schedule.
c. Mason reports his job-related expenses on a Schedule C.
d. Mason obtained his job skills from Isabella’s training program.
e. Mason performs the services at Isabella’s business location.
f. Mason is paid based on time worked rather than on task performed.
Answer:
Answer letter B
Masin sets his own work schedule
A company carefully defines its target market. Now the company will be able to focus on people with a preexisting need or interest in what it offers. Therefore resulting in higher sales and less wasted time and effort on potential customers that are not interested in what the company has to offer. This is an example of:_____.a. why a company would seek to define its target market a a component in creating the company's marketing strategy.
b. why the marketing strategy defines the target market for a company.
c. why it is important for companies to develop their value proposition.
d. why carefully choosing customers is important when engaging in product development.
Answer: a. Why a company would seek to define its target market as a component in creating the company's marketing strategy
Explanation:
A target market for a particular business simply means the group of customers that the business channels its marketing efforts towards. For example, a business that produces mens clothes will channel its efforts towards men rather than women, therefore its target market will be men.
Based on the scenario in the question, this is an example of why a company would seek to define its target market a a component in creating the company's marketing strategy. Identifying the target market will help in minimizing waste fo resources and bring about increase in productivity.
Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 26 percent for the next three years, with the growth rate falling off to a constant 6 percent thereafter. If the required return is 12 percent, and the company just paid a dividend of $1.90, what is the current share price?
Answer:
$ 55.04
Explanation:
Year 1 dividend=$1.90*(1+26%)=$2.394
Year 2 dividend=$2.394 *(1+26%)=$3.01644
Year 3 dividend=$3.01644 *(1+26%)=$3.8007144
Terminal value of dividend=Year 3 dividend*(1+terminal growth rate)/(required return-terminal growth rate)
Terminal value of dividend=$3.8007144 *(1+6%)/(12%-6%)=$67.1459544
The current share price is the present value of expected dividends and terminal value as below:
share price=$2.394 /(1+12%)^1+$3.01644 /(1+12%)^2+$3.8007144 /(1+12%)^3+$67.1459544/(1+12%)^3
share price=$55.04
The following information is available on a depreciable asset owned by Mutual Savings Bank:___________.
Purchase date July 1, Year 1
Purchase price $78,100
Salvage value $10,900
Useful life 8 years
Depreciation method straight-line
The asset's book value is $61,300 on July 1, Year 3. On that date, management determines that the asset's salvage value should be $5,900 rather than the original estimate of $10,900. Based on this information, the amount of depreciation expense the company should recognize during the last six months of Year 3 would be:_________.
a. $4,616.67
b. $2,554.17
c. $2,308.33
d. $1,854.17
e. $2,241.37
A total asset turnover ratio of 3.0 indicates that:
For every $1 in sales, the firm acquired $3.0 in assets during the period.
For every $1 in assets, the firm produced $3.0 in net sales during the period.
For every $1 in assets, the firm earned gross profit of $3.0 during the period.
For every $1 in assets, the firm earned $3.0 in net income.
For every $1 in assets, the firm paid $3.0 in expenses during the period.
Answer and Explanation:
The computation of the depreciation expense under the straight-line method is shown below:
= (Purchase cost - residual value) ÷ (Remaining life left)
= ($61,300 - $5,900) ÷ ( 8 - 2)
= $55,400 ÷ 6 years
= $9,233.33
Now for the six months it would be
= $9,233.33 × 6 months ÷ 12 months
= $4,616.67
The asset turnover is the turnover that comes by dividing the revenue from the average of the total assets
Here as per the given option the second option is correct as it correctly represents the asset turnover
Match the factor with how it contributes to a product's launch.
1. budget
enhances consumers'
understanding
2. marketing
gauges potential channels
3. market research
executes strategy for sales
How would you define a method that calcuates and reutrns the final price, after tax and tip, for a passed in price, assuming tip is always 15% and tax is always 8%?
Complete Question
How would you define a method that calculates and returns the final price after tax and tip. for a passed in price, assuming tip is always 15% and tax is always 8%? Options:
O public double getFinalPrice double basePrice) (....)
O public void setFinal Price int tax int tip) (....)
O public int get celint basePrice (....)
O public void getFinal Pricelint basePrice (....)
Answer:
A method that calculates and returns the final price after tax and tip, for a passed in price, assuming tip is always 15% and tax is always 8% can be defined as:
O public void setFinal Price int tax int tip) (....)
Explanation:
The above chosen option will calculate and return the final price after adding 15% for tips and 8% for tax. The final price, which a customer is expected to settle, includes the cost of the services, the tip the customer pays on the cost, and the tax on the cost of the services. This method will ensure that the customer pays the correct sales revenue to the organization. It is mostly used by hotels and other entertainment organizations in calculating the final price of the services rendered to clients.
1. What characteristics of sales promotions account for the high levels of expenditures that have been allocated to them in recent years?2. What role does sales promotion play in the trade channel and in business markets?
3. Why are sales promotions considered "risky" as a tool for integrated marketing communication (IMC)?
Answer:
1. Marketing a product with making an advertisement with a high paid cast requires a high level of expenditure. This type of sales promotion is considered an effective but expensive.
2. Sales promotion plays a vital role in the trade channel and also in business markets as by promoting a product the customer and consumer comes to know about the product and its features by which it can differentiate it with other similar products and if the promotion is effective the consumer demand will increase and thus both the consumers and customers will buy the product.
3. Integrated Marketing Communication (IMC) is considered a risky tool for sales promotion because in this method an organisation coordinates with many channels to spread their message which is risky because according to a survey almost 70% of the messages lost their initial meaning while reaching the third channel.
Explanation:
1. Marketing a product with making an advertisement with a high paid cast requires a high level of expenditure. This type of sales promotion is considered an effective but expensive.
2. Sales promotion plays a vital role in the trade channel and also in business markets as by promoting a product the customer and consumer comes to know about the product and its features by which it can differentiate it with other similar products and if the promotion is effective the consumer demand will increase and thus both the consumers and customers will buy the product.
3. Integrated Marketing Communication (IMC) is considered a risky tool for sales promotion because in this method an organisation coordinates with many channels to spread their message which is risky because according to a survey almost 70% of the messages lost their initial meaning while reaching the third channel.
The greatest number of advance pricing agreements have been negotiated with the U.S. Internal Revenue Service (IRS) for which type of intercompany transaction? a) Sales of tangible property b) Licenses of intangible property c) Intercompany loans d) Intercompany services
Answer:
a) Sales of tangible property
Explanation:
An advance pricing agreements can be defined as an agreement made between the tax revenue agency and the tax payers made ahead of time on the appropriate transfer pricing model.
The greatest number of advance pricing agreements have been negotiated with the U.S. Internal Revenue Service (IRS) for sales of tangible property.
QUESTION THREE.
The following data give the savings bank accounts balances of nine sample
households selected in a survey. The figures are in SSP
745.2,000.1.500.68,000.461,549,3750,1800,4795
(a) Find the mean and the median for these data;
(6) Do these data contain an outlier? If so, exclude this value and recalculate th
mean and median. Which of these summary measures has a greater change wh
outlier is dropped?;
(c) Which of these two summary measures is more appropriate for this series?
Answer:
We can first order the data from smallest value to largest value:
461
549
745
1500
1800
2000
3750
4795
68000
a) The mean is 9289, and the median is 1800
b) The data does have an outlier, which is 68000, because it is more that three standards deviations away from the mean, excluding this value, our new mean is 1950 and our new median is 1650. We can see that the greatest change in value was for the mean.
c) the median is more appropriate because the median is less sensitive to outliers. The mean can be easily swayed by outliers in either way, and this can give an erroneous impression of the data.
Suppose that the market for a product is characterized by a downward-sloping, linear demand curve and an upward-sloping, linear supply curve.
(a) Suppose the price elasticity of supply is 0.6. Will the deadweight loss from a $2 tax per unit be smaller if the absolute value of the price elasticity of demand is 0.3 or if the absolute value of the price elasticity of demand is 1.5? Explain.
(b) If a $2 tax per unit results in a deadweight loss of $100, how large would be the deadweight loss from a $4 tax per unit? Explain.
Answer:
A) The deadweight loss will be greater when the absolute value of price elasticity of demand = 0.3
B) The deadweight loss is bigger when the value of Nd is larger and also
since a $2 tax per unit results in a deadweight loss of $100 the deadweight loss for a $4 tax per unit will be 2 times larger i.e. $200
Explanation:
A) Given
price elasticity of supply (Ns)= 0.6
absolute value of elasticity (Nd) = 0.3
absolute value of elasticity 2 ( Nd ) = 1.5
we will apply the deadweight rule here
DWL = -0.5*(Ns Nd)/(Ns - Nd ) * (t^2) * Q/P
For;
( Nd = 0.3 ) = -0.5*( 0.6*0.3) / (0.6-0.3 ) * 2^2
= - 0.5 * ( 0.18 / 0.3 ) * 4 = -1.2
( Nd = 1.5 ) = -0.5*(0.6*1.5 )/( 0.6 - 1.5 ) * 2^2
= -0.5 * ( 0.9 ) / (-0.9) * 4 = 2
The deadweight loss will be greater when the absolute value of price elasticity of demand = 0.3
B) The deadweight loss is bigger when the value of Nd is larger and also
since a $2 tax per unit results in a deadweight loss of $100 the deadweight loss for a $4 tax per unit will be 2 times larger i.e. $200
Over the past four years, the annual percentage returns on large-company stocks were 15, 7, 4, and 18%. For the same time period, U.S. Treasury bills produced the returns of 6, 3, 2, and 4 percent. Inflation averaged 2.8% over the four-year period. The average real rate of return on large-company stocks was ___% as compared to _____% for Treasury bills.a. 6.47; .92.
b. 6.47; 1.08.
c. 7.98; .92.
d. 7.98; 1.08.
e. 7.98; 1.22.
Answer:
c. 7.98; .92.
Explanation:
My calculations varied slightly (0.02% and 0.01%), but the error might be a rounding error. Option C is the logical answer since the difference is minimum.
real rate returns from stocks:
15% - 2.8% = 12.2%
7% - 2.8% = 4.2%
4% - 2.8% = 1.2%
18% - 2.8% = 15.2%
average real return = 8.2% arithmetic mean
average real return = 8% geometric mean
real rate returns from US T-bills:
6% - 2.8% = 3.2%
3% - 2.8% = 0.2%
2% - 2.8% = -0.8%
4% - 2.8% = 1.2%
average real return = 0.95% arithmetic mean
average real return = 0.93% geometric mean
Draco Company charges a selling price of $25 per unit for its single product, incurs variable costs of $17 per unit, and total fixed costs of $140,000. What sales volume is necessary to earn a net income after tax of $36,000, assuming a tax rate of 25%?
a. 17,500
b. 21,500
c. 23,500
d. 32,000
e. None of the above
Answer:
c. 23,500
Explanation:
The formula for determining target sales volume is shown below:
target sales volume=fixed costs+ target net income before tax/contribution margin per unit
fixed costs=$140,000
target net income before tax=$36,000/(1-25%)=$48000
contribution margin per unit=selling price-variable cost=$25-$17=$8
target sales volume=($140,000+$48000 )/$8
target sales volume=$188,000/$8
target sales volume=23500
Jackson Corp. (a U.S.-based company) sold parts to a Korean customer on December 16, 2021, with payment of 20 million Korean won to be received on January 15, 2022. The following exchange rates applied:
Date Spot Rate Forward Rate to Jan.15
December 16, 2021 $ 0.00082 $ 0.00089
December 31, 2021 0.00080 0.00083
January 15, 2022 0.00086 0.00086
Assuming a forward contract was entered into, the foreign currency was originally sold in the foreign currency market on December 16, 2021 at a:
Answer:
The correct option is (b)
Explanation:
According to the scenario, the foreign currency that original sold at the market is shown below:
= (Forward rate to Jan 15 - Spot rate) × paymen made
= ($0.00089 - $0.00082 ) × 20 million
= $0.00007 × 20,000,000
= $1,400 premium
hence, the foreign currency that originally sold at the market is $1,400 premium
Therefore the correct option is (b)
The Ultimate recreational tennis racket NWC requirements at the beginning of each year will be approximately 20 percent of the projected sales during the coming year. The tax rate is 34 percent and the required return on the project is 10 percent. What will the cash flows for this project be?
Answer:
The question is incomplete, it only includes the last part. So I looked for similar questions and found it:
You are evaluating a project for The Ultimate recreational tennis racket, guaranteed to correct that wimpy backhand. You estimate the sales price of The Ultimate to be $400 per unit and sales volume to be 1,000 units in year 1; 1,250 units in year 2; and 1,325 units in year 3. The project has a three-year life. Variable costs amount to $225 per unit and fixed costs are $100,000 per year. The project requires an initial investment of $165,000 in assets, which will be depreciated straight-line to zero over the three-year project life. The actual market value of these assets at the end of year 3 is expected to be $35,000. NWC requirements at the beginning of each year will be approximately 20 percent of the projected sales during the coming year. The tax rate is 34 percent and the required return on the project is 10 percent.
What will the cash flows for this project be?
initial outlay = -$165,000
depreciation expense per year = $55,000
change in NWC:
year 1 = 1,000 x $400 x 20% = $80,000year 2 = 1,200 x $400 x 20% = $96,000, so it is a $16,000 increaseyear 3 = 1,350 x $400 x 20% = $108000, so it is a $12,000 increasecontribution margin per unit = $400 - $225 = $175
after tax salvage value = $35,000 x (1 - 34%) = $23,100
cash flow year 0 = -$165,000 - $80,000 = -$245,000
cash flow year 1 = {[($175 x 1,000) - $100,000 - $55,000}] x 0.66} + $55,000 - $16,000 = $52,200
cash flow year 2 = {[($175 x 1,200) - $100,000 - $55,000}] x 0.66} + $55,000 - $12,000 = $79,300
cash flow year 3 = {[($175 x 1,350) - $100,000 - $55,000}] x 0.66} + $55,000 + $108,000 + $23,100 = $239,725
Suppose the economy is at a point below its physical production possibilities frontier but above its institutional production possibilities frontier. In response to this situation, Keynesian economists may propose that government enact ________ fiscal policy to correct this ________ gap by ________ government expenditures.
Answer: contractionary; inflationary; decreasing
Explanation:
A contractionary fiscal policy is used in order to reduce the money that is in circulation. In this policy, the government increases tax and also cuts its spending.
The contractionary fiscal policy will be used according to Keynesian to correct the inflationary gap by decreasing the expenses of the government.
A home mortgage that can be repaid over a 30-year period is an example of:
A. a line of credit.
B. a student loan.
C. a short-term loan.
D. a long-term loan.
Answer:
D. a long-term loan.
Explanation:
Loans are classified based on varied parameters. There are secure and unsecured loans, installment credit and revolving credit. Also, there loans with fixed interest rates and others with variable interest rates.
Loans are also categorized depending on the duration it takes to repay them. Short term loans are those repaid with one year. For businesses, these loans are short term liabilities.
Long-term loans take longer than one year to repay. The mortgage is to be paid over 30 years period. To businesses, these loans are long-term liabilities.
A mindset refers to regard for global culture and identification with individuals everywhere. These people are less influenced by "buy local" promotions, resulting in demand being more elastic. Select one: a. global ( b. domestic ( c. regional (d. state
Answer:
A
Explanation:
The change in demand as a result of a price change is large inelastic demand, explained further.
What does demand elastic mean?The change in demand as a result of a price change is large in an elastic demand. A demand that is inelastic is one in which the change in demand as a result of a price change is modest.
A mentality is defined as a respect for global culture and affiliation with people all over the world. Because they are less affected by "buy local" promotions, demand is more elastic and global.
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If the cost of the beginning work in process inventory is $60,000, costs of goods manufactured is $890,000, direct materials cost is $330,000, direct labor cost is $210,000, and overhead cost is $315,000, calculate the ending work in process inventory.a. $350,000
b. $35,000. c. $355,000. d. $45,000. e. $25,000.
Answer:
Ending WIP= $25,000
Explanation:
To calculate the ending work in process, we need to use the following formula:
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
890,000 = 60,000 + 330,000 + 210,000 + 315,000 - Ending WIP
Ending WIP= 915,000 - 890,000
Ending WIP= $25,000
kya clark borrowed 7500 ay 6%ordinary interest for 180 days after 40 days she made a partial payemnt of 2500 after another 70 days kya made a second partial payment of 3000 using the U.S rule what is the final amount due?
Answer:
$2,133.52
Explanation:
lets try to put some dates into the question:
Kya borrowed $7,500 on June 1.
On July 10, she made a partial payment of $2,500. The loan's balance on July 10 was $7,500 + [$7,500 x 6% x 40/360 (remember ordinary interest is 360 days)] = $7,550 - $2,500 = $5,050
On September 18, Kya made a second payment of $3,000. The loan's balance before the payment = $5,050 + ($5,050 x 6% x 70/360) = $5,108.92 - $3,000 = $2,108.92
On November 27 when her loan is due, she will need to pay $2,108.92 + ($2,108.92 x 6% x 70/360) = $2,133.52
Assume that Clampett, Inc. has $200,000 of sales, $150,000 of cost of goods sold, $60,000 of interest income, and $40,000 of dividends. Assume that Clampett, Inc. never operated as a C corporation and that the corporate tax rate is 21%. What is Clampett, Inc.'s excess net passive income tax?
A- 0
B- $21,000
C- $75,000
D- $100,000
E- None of these choices are correct
Answer:
B $21,000
Explanation:
Given that;
Sales = $200,000
Cost of goods sold = $150,000
Interest income = $60,000
Dividends = $40,000
Tax rate = 21%
Then,
Net passive income tax = Net passive income × Tax rate
Or
= (Interest income + Dividends) × Tax rate
= ($60,000 + $40,000) × 21%
= $21,000
Select the correct answer.
Informatics includes all support staff at a hospital.
A. True
B. False
Suppose that because of a sudden increase in life expectancy, a lot of people decide to save more for what they expect to be a longer retirement. This will:____.1. shift the demand for loanable funds to the right causing the interest rate to rise. b. shift the demand for loanable funds to the left causing the interest rate to fall. c. shift the supply of loanable funds to the left causing the interest rate to rise. d. shift the supply of loanable funds to the right causing the interest rate to fall.
Answer: d. shift the supply of loanable funds to the right causing the interest rate to fall.
Explanation:
Loanable funds come from the deposits(savings) that people make in financial institutions like banks. If more people were to make deposits, the amount of savings in the system would therefore increase.
To illustrate this increase the supply for loanable funds curve will shift to the right which will cause the interest rates to fall as there is now more supply relative to demand.
If you are under 59 % and you withdraw money from your traditional IRA, which of the following is the exception to the additional penalty tax?
Choose one answer.
a. You are disabled
b. You have unreimbursed medical expenses that are more than 7.5% of your AGI
c. You are the beneficiary of a deceased IRA owner
d. All of these
e. None of these
Answer:
A-You are disabled
Explanation:
If you're disabled, you can withdraw IRA funds without penalty. If you pass away, there are no withdrawal penalties for your beneficiaries. You can avoid an early withdrawal penalty if you use the funds to pay unreimbursed medical expenses that are more than 7.5% of your adjusted gross income (AGI).
Given the institutional differences between European and Eurasia markets, what are the main challenges faced by TeliaSonera in Eurasia?
Answer:
The European market and Eurasia markets are different in many ways.
Explanation:
The legal, economic and the regulatory systems in each of the country in Eurasia are highly bureaucratic, although market economy is in different phase transition. The operation of TeliaSonera in Eurasia tries to utilize the know-how mainly in communication, investments and infrastructure where institutional framework are in transitional phase from planned to the market economy and is its weaker than in Europe.
TeliaSonera, due to their weak institutional regulations and settings, faces challenges in Eurasia specially in the former USSR.
Initial Outlay -$5,000 Year 1 $3,000 Year 2 $3,500 Year 3 $3,200 Year 4 $2,800 Year 5 $2,500. a. What is the PI if the discount rate is 20%?b. What is the NPV if the discount rate is 20%? Round to the second decimal place. Type only numbers without any unit ($, %, etc.) If there are multiple answers, then type NA.c. What is the IRR if the discount rate is 20%? Answer in the percent format. Round to the hundredth decimal place. Type only numbers without any unit ($, %, etc.)d. What is the EAA if the discount rate is 20%? Round to the penny. Type only numbers without any unit ($, %, etc.)
Answer:
a. What is the PI if the discount rate is 20%?
profitability index = present value of cash flows / initial outlay
PI = $9,137.41 / $5,000 = 1.83
b. What is the NPV if the discount rate is 20%?
NPV = -$5,000 + $9,137.41 = $4,137.41
c. What is the IRR if the discount rate is 20%?
the discount rate is irrelevant when you are calculating the IRR, since the IRR is the discussion rte at which the NPV = $0
IRR = 55.23%
Explanation:
Initial Outlay -$5,000
Year 1 $3,000
Year 2 $3,500
Year 3 $3,200
Year 4 $2,800
Year 5 $2,500.
