Business High School
Answers
Answer 1
VTEPS, Inc. has observed a relationship between the selling price of its educational product and the corresponding demand. As the selling price varies, it affects the level of demand for the product. The approximate relationship between price and demand can be described as follows:
As the selling price increases, the demand for the educational product tends to decrease. Conversely, when the selling price decreases, the demand for the product tends to increase. This suggests an inverse relationship between price and demand, where higher prices result in lower demand and lower prices lead to higher demand.
It is important to note that the relationship between price and demand may not be a perfect one-to-one correlation. Other factors, such as competitors' pricing, consumer preferences, marketing efforts, and economic conditions, can also influence the demand for the educational product. VTEPS, Inc. can utilize this understanding of the price-demand relationship to optimize its pricing strategy and maximize profitability.
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Comment on the following quotation: "One way that a minimum wage could result in expanded employment is if the government sets the minimum below the market equilibrium wage."
Answers
The quotation suggests that under certain circ*mstances, a minimum wage below the market equilibrium wage could lead to increased employment.
This viewpoint is based on the idea that when the minimum wage is set below the equilibrium, it does not impose excessive labor costs on employers, allowing them to hire more workers. However, it is important to note that the impact of minimum wage policies on employment is a topic of debate among economists. The conventional economic theory suggests that when the minimum wage is set above the equilibrium, it can lead to a reduction in employment as businesses may be unable or unwilling to afford higher labor costs.
The statement implies that if the minimum wage is set below the market equilibrium wage, businesses could benefit from lower labor costs, potentially leading to increased hiring and expanded employment opportunities. However, it is essential to consider the broader context and factors that influence employment dynamics, such as the overall state of the economy, industry-specific conditions, and the elasticity of labor demand.
It is worth noting that the effects of minimum wage policies can vary depending on various factors, including the level of the minimum wage, the elasticity of labor demand, and the overall economic conditions. Empirical research on the employment effects of minimum wage policies has produced mixed results, further emphasizing the complexity of the issue.
Therefore, while setting the minimum wage below the market equilibrium wage may be argued as a potential way to expand employment, it is crucial to consider a range of economic factors and empirical evidence to assess the overall impact on employment and labor market dynamics.
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"Interview two (2) different managers preferably one from a
manufacturing organization and one from a service organization. Ask
them about how they manage operations, particularly from the
aspects of b"
Answers
To interview two different managers, one from a manufacturing organization and one from a service organization, you can follow these steps:
1. Identify the managers: Reach out to managers in your network or search for managers in your desired industries through professional networking sites or by contacting local businesses.
2. Schedule the interviews: Once you have identified the managers, reach out to them to request an interview. Clearly state your purpose and the topics you would like to discuss.
3. Conduct the interviews: During the interviews, ask the managers about how they manage operations, particularly focusing on the following aspects:
4. Take notes: During the interviews, make sure to take detailed notes of the managers' responses.
5. Analyze and compare the responses: Once the interviews are completed, review your notes and compare the responses from the manufacturing and service managers. Look for similarities and differences in their approaches to managing operations.
6. Summarize your findings: Write a summary of your findings, highlighting the key points and insights gained from the interviews. Consider including any notable differences or similarities between the two managers' approaches to managing operations.
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Dakota Company experienced the following events during Year 2. 1. Acquired $30,000 cash from the issue of common stock. 2. Paid $12,000 cash to purchase land. 3. Borrowed $10,000 cash. 4. Provided services for $20,000 cash. 5. Paid $1,000 cash for utilities expense. 6. Paid $15,000 cash for other operating expenses. 7. Paid a $2,000 cash dividend to the stockholders. 8. Determined that the market value of the land purchased in Event 2 is now $12,700. Required a. The January 1, Year 2, general ledger account balances are shown in the following accounting equation. Record the eight events in the appropriate general ledger accounts. Record the amounts of revenue, expense, and dividends in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the table. The first event is shown as an example. (Enter any decreases to account balances with a minus sign. Not all cells in the "Accounts Titles for Retained Earnings" column may require an input - leave cells blank if there is no corresponding Retained Earnings input needed.) Assets + DAKOTA COMPANY Accounting Equation for Year 2 Liabilities Stockholders' Equity Notes Common Retained Land + Payable Stock Earnings 12,000/= 6,000+ 8,000 Event Account Titles for Retained Earnings Cash + Balance 1/1/Year 2 2,000+ + 1. + 30,000 + 2. 12,000/= + + 3. 10,000+ + 4. 30,000 + (12,000)| + 10,000+ 20,000 + (1,000)| + (15,000) + (2,000) + = + + 5. + + 20,000 Service revenue (1,000) Utilities expense (15,000) Operating expense (2,000) Dividends 6. + 7. + + + + + + 8. + Totals 32,000+ 24,000/= 10,000+ 36,000+ 10,000 b-1. Prepare an income statement for the Year 2 accounting period. DAKOTA COMPANY Income Statement For the Year Ended December 31, Year 2 Service revenue $ 20,000 Utilities expense (1,000) Operating expense (15,000) Net income $ 4,000 DAKOTA COMPANY Balance Sheet As of December 31, Year 2 Assets Cash $ 32,000 Land 24,000 $ 56,000 Total assets Liabilities Notes payable $ 10,000 $ 10,000 Total liabilities Stockholders' Equity Common stock $ 36,000 Retained earnings 10,000 46,000 Total stockholders' equity Total liabilities and stockholders' equity $ 56,000 d. Based on the December 31, Year 2, balance sheet, what is the largest cash dividend Dakota could pay? Cash dividend $ 31,500
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The largest cash dividend Dakota could pay, according to the given balance sheet, is $10000. Let's see how we can find it below.
Dakota Company's accounting equation for Year 2 is shown below:
Assets = Liabilities + Stockholders' Equity
$56,000 = $10,000 + $46,000
Total stockholders' equity = $46,000
Now, to determine the maximum cash dividend that can be paid, we must first ensure that there is sufficient retained earnings. Retained earnings are equal to $10,000, and any amount distributed as a cash dividend will reduce this amount. Therefore, the maximum amount of cash dividends that may be paid is the total amount of retained earnings.
$10,000 is the largest cash dividend that Dakota can pay.
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Combined-cycle power plants use two combustion turbines to produce electricity. Heat
from the first turbine’s exhaust is captured to heat water and produce steam sent to a
second steam turbine that generates additional electricity. A 968-megawatt combined-
cycle gas fired plant can be purchased for $430 million, has no salvage value, and
produces a net cash flow (revenues less expenses) of $52 million per year over its
expected 30-year life. At hurdle rate (MARR) of 9.75%, how profitable an investment is
this power plant? What is the discounted payback period for the plant? Is this investment
acceptable?
Answers
The present worth of the combined-cycle power plant is $722.73 million. The plant has a discounted payback period of 11.76 years.
Given data: The combined-cycle power plant cost= $430 million
Net cash flow per year= $52 million
Hurdle rate = 9.75%
Expected life = 30 years
Salvage value = $0
Discounted payback period= ?
Present worth (P) of combined-cycle power plant;
P = A × P/A, i= 9.75%, n= 30 years, where A is the annual equivalent cash flow.
P = 52 × (1 - 1 / (1 + 0.0975)30) / 0.0975= $722.73 million
The discounted payback period can be calculated as follows:
CF0 = -$430 million
CF1 to CF30 = $52 million
The discounted payback period is the year when the cumulative discounted cash flows turn positive.
The cumulative discounted cash flow at the end of year 11 is $543.4 million.
The remaining amount to be recovered is $430 - $543.4 = -$113.4 million.
Since it is a negative value, the cumulative discounted cash flows will not be recovered in 11 years. Thus, we need to find the year when the cumulative discounted cash flow turns positive.
CF11 = $52 million × (1 - 1 / (1 + 0.0975)11) / 0.0975= $56.97 million
CPB = 11 + ($430 - $543.4) / $56.97= 11.76 years
The discounted payback period is 11.76 years which is greater than the expected life of the plant. Hence, the investment is not acceptable.
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B. On Each Part, A Rather Unreliable Backup Can Be Installed That Has A Reliability Of Just 25.00%. What Is The Maximum Amount
Answers
The maximum amount refers to the highest value that can be achieved or reached. In this case, the maximum amount would indicate the highest reliability percentage that the unreliable backup can have. Given that the unreliable backup has a reliability of just 25.00%, the maximum amount would be 25.00%.
The question states that a rather unreliable backup can be installed on each part with a reliability of just 25.00%. This means that the backup has a 25.00% chance of successfully functioning. In this scenario, the maximum amount of reliability that can be achieved with this backup is 25.00%. The maximum amount in this context refers to the highest possible value that can be obtained. In the given question, it mentions that a rather unreliable backup can be installed on each part, and this backup has a reliability of just 25.00%.
This means that the backup has a 25.00% chance of successfully functioning. In other words, out of 100 instances, it is expected to fail 75 times. Therefore, the maximum amount of reliability that can be achieved with this backup is 25.00%. This implies that even under the best-case scenario, the backup can only provide a 25.00% chance of success. It is important to note that a reliability of 25.00% is considered quite low and may not be suitable for critical systems or applications where a higher level of dependability is required.
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Evaluate the extent of ABC system adoption in Australian firms. Include in your answer:
i. the factors for adoption success by Australian firms
ii. the factors for non-adoption and/or slow adoption by Australian firms
iii. any two (2) specific real case examples as evidence
Answers
i. The extent of ABC system adoption in Australian firms varies, with some firms successfully adopting the system while others show non-adoption or slow adoption.
ii. Factors for non-adoption and/or slow adoption include lack of understanding and awareness, high implementation costs, complexity of the system, and resistance to change two specific real case examples are the successful adoption of ABC system by Coopers Brewery and the slow adoption by Rio Tinto, a mining company. coopers Brewery, a leading Australian brewery, successfully adopted the ABC system, which helped them improve cost allocation and identify areas of inefficiency. On the other hand, Rio Tinto, a mining company, faced slow adoption due to the complexity of implementing the ABC system across its extensive operations and the resistance to change from its employees.
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what options do Tesla and Honda use for international markets? For example, exporting, franchising, licensing, strategic alliance, etc...
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Tesla and Honda employ a variety of strategies to enter and expand in international markets. These strategies include exporting, licensing, and establishing strategic alliances. Each approach serves different purposes and allows the companies to navigate diverse market conditions and regulatory environments.
Tesla primarily utilizes exporting as a strategy to access international markets. The company manufactures its electric vehicles (EVs) in its home country, the United States, and exports them to various countries around the world. This approach enables Tesla to maintain control over its production processes and maintain its brand image globally. By exporting, Tesla can reach markets where it does not have a physical presence or manufacturing facilities.
Honda, on the other hand, employs a more diverse set of strategies for international markets. Alongside exporting its vehicles, Honda has a strong presence in licensing agreements. Through licensing, Honda grants other companies the right to use its technology, brand, or manufacturing processes in exchange for fees or royalties. This strategy allows Honda to expand its market reach by leveraging the capabilities of local partners who have knowledge of regional market conditions and distribution networks.
Additionally, both Tesla and Honda have entered into strategic alliances with other companies to penetrate international markets. These alliances involve partnerships, joint ventures, or collaborations with local firms. By forming strategic alliances, both companies gain access to local expertise, resources, and distribution channels. Such alliances can help overcome regulatory hurdles, cultural differences, and market barriers while enhancing market penetration and profitability.
In summary, Tesla primarily relies on exporting as a strategy to access international markets, while Honda utilizes a combination of exporting, licensing, and strategic alliances. These strategies allow both companies to adapt to different market conditions and leverage the strengths of local partners to enhance their global presence.
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Supposedly some casinos in the South allow a person to sign a contract that mandates their arrest if the person enters the casino. a. Describe such contracts and people in the language of hyperbolic discounting. b. Write down the hypothesis that could explain this behavior. What kind of data would you collect in order to test this hypothesis?
Answers
Hyperbolic discounting refers to the tendency of people to undervalue distant future outcomes and overvalue immediate rewards. The hypothesis that could explain this behavior is that people who sign such contracts are more likely to have a high discount rate for future rewards.
a. Hyperbolic discounting refers to the tendency of people to undervalue distant future outcomes and overvalue immediate rewards. In the case of signing a contract mandating their arrest, if they enter a casino, people are likely to focus on the immediate benefits of entering the casino, such as the possibility of winning money or having fun, rather than the long-term consequences of getting arrested. This results in people making decisions that are not in their long-term interest, as they are overly influenced by the immediate reward of entering the casino and not considering the potential long-term consequences of getting arrested.
b. The hypothesis that could explain this behavior is that people who sign such contracts are more likely to have a high discount rate for future rewards, which means that they place a relatively low value on future outcomes compared to immediate rewards. To test this hypothesis, researchers could collect data on the discount rates of people who sign these contracts compared to those who do not. They could also compare the behavior of people who sign these contracts to those who do not, such as their likelihood of entering a casino or their success at avoiding entering a casino. By comparing these groups, researchers could determine whether people who sign such contracts are more likely to have a high discount rate for future rewards and whether this contributes to their decision to sign the contract and enter the casino.
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prices of zero-coupon bonds reveal the following pattern of forward rates: year forward rate 1 4 % 2 5 3 7 in addition to the zero-coupon bond, investors also may purchase a 3-year bond making annual payments of $40 with par value $1,000. a. what is the price of the coupon bond? (do not round intermediate calculations. round your answer to 2 decimal places.) b. what is the yield to maturity of the coupon bond? (do not round intermediate calculations. round your answer to 2 decimal places.) c. under the expectations hypothesis, what is the expected realized compound yield of the coupon bond? (do not round intermediate calculations. round your answer to 2 decimal places.) d. if you forecast that the yield curve in 1 year will be flat at 7.0%, what is your forecast for the expected rate of return on the coupon bond for the 1-year holding period?
Answers
a. To find the price of the coupon bond, calculate the present value of each cash flow using the corresponding forward rates and sum them up.
b. The yield to maturity (YTM) of the coupon bond is the rate that makes the present value of the bond's cash flows equal to its market price.
c. According to the expectations hypothesis, the expected realized compound yield of the coupon bond is the average of the forward rates.
d. If the forecasted yield curve in 1 year is 7.0%, the expected rate of return on the coupon bond for the 1-year holding period would be the coupon payment divided by the bond price.
a. To calculate the price of the coupon bond, we need to calculate the present value of its future cash flows, which include both coupon payments and the final principal payment.
The bond has a par value of $1,000 and makes annual payments of $40 for 3 years. We need to discount these cash flows using the corresponding forward rates. The present value of each cash flow can be calculated as follows:
Year 1: $40 / (1 + 4%)^1
Year 2: $40 / (1 + 5%)^2
Year 3: $1,040 / (1 + 7%)^3 (coupon payment + principal payment)
b. The yield to maturity (YTM) of the coupon bond is the rate that equates the present value of the bond's cash flows to its market price. Since we know the price of the coupon bond from part (a), we can use an iterative process to find the YTM. By adjusting the discount rate, we can find the rate that makes the present value of the bond's cash flows equal to its price.
c. Under the expectations hypothesis, the expected realized compound yield of the coupon bond is equal to the average of the forward rates. In this case, it would be the average of the forward rates for years 1, 2, and 3.
d. If the forecast for the yield curve in 1 year is a flat 7.0%, the expected rate of return on the coupon bond for the 1-year holding period would be the coupon payment of $40 divided by the price of the bond.
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a worker or worker representative can file a complaint about a safety or health hazard in the workplace
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Yes, a worker or worker representative has the right to file a complaint about a safety or health hazard in the workplace.
If they identify any hazardous conditions that pose a risk to their well-being or that of their colleagues, they should promptly report the issue to the appropriate authority within their organization, such as the supervisor, safety officer, or human resources department.
The complaint should clearly outline the nature of the hazard, its potential consequences, and any relevant supporting evidence. It is crucial for employers to take these complaints seriously and address them promptly to ensure a safe working environment.
Workers also have the option to report such hazards to external entities, such as occupational safety and health agencies, labor departments, or unions, who can intervene and advocate on their behalf if necessary.
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You want to borrow $27,000 to buy a new car. Your annual interest rate is 4.3% over 4 years with monthly payments. Calculate your monthly payment. You have credit card debt of $3,000 at 24% APR compounded monthly. If you charge no more purchases to the card and make monthly payments of $375, how many months will it take you to payoff your debt? How many months will it take you to pay off a loan of $14,000 at 4% APR compounded monthly if you make monthly payments of $825 ?
Answers
For a car loan of $27,000 at 4.3% APR over 4 years with monthly payments, the monthly payment is approximately $640.07. It will take approximately 9.5 months to pay off a credit card debt of $3,000 with monthly payments of $375. It will take approximately 21.9 months to pay off a loan of $14,000 at 4% APR with monthly payments of $825.
To calculate the monthly payment for a loan of $27,000 at an annual interest rate of 4.3% over 4 years with monthly payments, use the formula:
P = (r * PV) / (1 - (1 + r)^(-n))
Where:
P = monthly payment
PV = present value (loan amount)
r = monthly interest rate (annual rate divided by 12)
n = number of months
Plugging in the values, we get:
PV = $27,000
r = 4.3% / 12 = 0.3583%
n = 4 years * 12 months = 48 months
P = (0.3583% * $27,000) / (1 - (1 + 0.3583%)^(-48))
P = $640.07 (rounded to the nearest cent)
Therefore, the monthly payment for the car loan is approximately $640.07.
To calculate the number of months it will take to pay off a credit card debt of $3,000 at 24% APR compounded monthly with monthly payments of $375, use the formula:
n = -log(1 - (r * PV) / P) / log(1 + r)
Plugging in the values, we get:
PV = $3,000
P = $375
r = 24% / 12 = 2%
n = -log(1 - (2% * $3,000) / $375) / log(1 + 2%)
n = 9.5 months (rounded to the nearest month)
Therefore, it will take approximately 9.5 months to pay off the credit card debt.
To calculate the number of months it will take to pay off a loan of $14,000 at 4% APR compounded monthly with monthly payments of $825, use the same formula:
n = -log(1 - (r * PV) / P) / log(1 + r)
Plugging in the values, we get:
PV = $14,000
P = $825
r = 4% / 12 = 0.3333%
n = -log(1 - (0.3333% * $14,000) / $825) / log(1 + 0.3333%)
n = 21.9 months (rounded to the nearest month)
Therefore, it will take approximately 21.9 months to pay off the loan.
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Sketch a graph of the demand curve for the following (Put price on the vertical axis and quantity on the horizontal axis): 1. Demand for fast food hamburgers. 2. Demand for McDonald's hamburgers. 3. Demand for low skilled workers/highly skilled workers (two graphs). 4. Demand for housing in the Silicon Valley.
Answers
Let's assume a typical downward-sloping demand curve for fast food hamburgers.
The vertical axis represents the price of hamburgers, and the horizontal axis represents the quantity demanded.Similarly, we can sketch a demand curve for McDonald's hamburgers. This curve may be specific to the demand for McDonald's brand rather than all fast food hamburgers. The shape of the curve can vary depending on factors such as brand loyalty, pricing strategies, and consumer preferences.For the demand for low skilled workers and highly skilled workers, we can represent them separately with different demand curves.
The vertical axis represents the wage or salary level, and the horizontal axis represents the quantity of workers.
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Problem 2-5 Calculating Taxes [LO3]
Timmy Tappan is single and had $179,000 in taxable income. Using the rates from Table 2.3 in the chapter, calculate his income taxes.
a.
What is the average tax rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
b. What is the marginal tax rate? (Do not round intermediate calculations and enter your answer as a percent rounded to the nearest whole number, e.g., 32.)
Answers
To calculate Timmy Tappan's income taxes, we need to use the tax rates from Table 2.3 in the chapter.
Unfortunately, without access to Table 2.3 or the specific tax rates, I am unable to provide the exact calculations for his income taxes, average tax rate, and marginal tax rate.
However, I can explain the concepts of average tax rate and marginal tax rate:
a. Average Tax Rate:
The average tax rate is the total tax paid divided by the taxable income. It represents the average percentage of income that is paid in taxes. To calculate the average tax rate, you would divide the total tax paid by the taxable income and express it as a percentage. For example, if Timmy Tappan's total tax paid is $30,000 and his taxable income is $179,000, the average tax rate would be (30,000 / 179,000) * 100 = 16.76%.
b. Marginal Tax Rate:
The marginal tax rate is the tax rate applied to the next dollar of taxable income. It represents the tax rate that Timmy Tappan would pay on an additional dollar of income. The marginal tax rate is determined by the tax brackets and tax rates specified in the tax system. To find the marginal tax rate, you would need to know the specific tax rates applicable to Timmy Tappan's taxable income and determine the rate that applies to the highest tax bracket he falls into.
I recommend referring to Table 2.3 or consulting the specific tax rates provided in the chapter to calculate Timmy Tappan's income taxes, average tax rate, and marginal tax rate accurately.
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Suppose we observe today the three-year Treasury security rate (
1
R
3
) to be 8%, the expected one year rate one year from today E(2r
1
) to be 6%, and the expected one year rate two years from now E
3
a
1
) will be 7%. Under the Unbiased Expectations Theory what must today's one year interest rate (R
1
) be?
Answers
According to the Unbiased Expectations Theory, the one-year interest rate today (R1) is equal to the expected one-year rate one year from today (E(2r1)). In this case, E(2r1) is given as 6%. Therefore, today's one-year interest rate (R1) must also be 6%.
The theory assumes that long-term interest rates are an average of current and expected future short-term interest rates. Since E(2r1) represents the expected one-year rate one year from today, it is considered the future short-term interest rate.
As a result, today's one-year interest rate is expected to be the same as the expected future one-year rate.
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John needs $1,000,000 to retire in five years. There is an annualzero-coupon bond with a par-value $1,000 that matures in 8 years. and has a YTM of 7.5% If John buys the bond and the YTM moves to 5.5% when he sells the bond in 5 years, how much money will John have for retiremei If John buys the bond and the YTM moves to 9.5% at what price will he sell the bond for in 5 years? If John buys the bond and the YTM moves to 9.5% when he sells the bond in 5 years, how much money will John have for retirement What is the current price of the 8 year zero-coupon bonds if the 7.5% ? How much does John need to invest today if the bonds YTM is 7.5% and he wants to reach his five year goal of $1,000,000 ?
Answers
1. John will have $788.23 for retirement. 2. sell the bond at $614.27 in 5 years. 3. have $1522.62 for retirement. 4. current price of the 8-year zero-coupon bond is $514.08. 5. John needs to invest $643,404.85.
The present value of the zero-coupon bond = $1,000
The par value of the bond = $1,000The bond matures in 8 years
YTM of the bond = 7.5%
John needs $1,000,000 to retire in five years.
Part 1 The formula to calculate the bond price when the yield changes = [tex]P = FV / (1 + r)n[/tex]
P = Present Value
FV = Future Value
R = Rate of return
N = number of years
P = $1000 / (1 + 5.5%)5
P = $788.23
John will have $788.23 for retirement.
Part 2 The formula to calculate the bond price when the yield changes = P = FV / (1 + r)n
P = Present Value
FV = Future Value
R = Rate of return
N = number of years
P = $1000 / (1 + 9.5%)5
P = $614.27
John will sell the bond at $614.27 in 5 years.
Part 3 The formula to calculate the future value of the bond = FV = PV x (1 + r)n
FV = Future Value
PV = Present Value
R = Rate of return
N = number of years
FV = $1000 x (1 + 9.5%)5
FV = $1522.62
John will have $1522.62 for retirement.
Part 4 The formula to calculate the price of the zero-coupon bond = P = FV / (1 + r)n
FV = Future Value
R = Rate of return
N = number of years
P = $1000 / (1 + 7.5%)8
P = $514.08
The current price of the 8-year zero-coupon bond is $514.08.
Part 5 The formula to calculate the present value of the bond = PV = FV / (1 + r)n
FV = Future Value
R = Rate of return
N = number of years
PV = $1,000,000 / (1 + 7.5%)5
PV = $643,404.85
John needs to invest $643,404.85 today if the bond's YTM is 7.5%, and he wants to reach his five-year goal of $1,000,000.
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Why do non-financial corporations need financial markets and institutions?
Answers
Non-financial corporations need financial markets and institutions for capital raising, risk management, liquidity, investment opportunities, and financial management support. These markets and institutions play a crucial role in enabling corporations to access funds, manage risks, find investment opportunities, and make informed financial decisions.
Non-financial corporations need financial markets and institutions for several reasons.
1. Capital raising: Financial markets and institutions provide non-financial corporations with a means to raise capital. When corporations need funds for various purposes such as expanding their business, investing in new projects, or acquiring assets, they can access the capital markets to issue stocks or bonds. This allows them to attract investors who are willing to provide the necessary funds in exchange for ownership or interest in the corporation.
2. Risk management: Financial markets and institutions offer various tools and instruments that help non-financial corporations manage financial risks. For example, corporations can use derivative contracts like futures or options to hedge against unfavorable price movements in commodities or currencies. By using these instruments, corporations can protect themselves from potential losses and stabilize their financial position.
3. Liquidity: Financial markets provide a platform where non-financial corporations can easily buy and sell financial assets. This liquidity is crucial for corporations that may need to convert their investments into cash quickly. For instance, if a corporation needs immediate cash to cover unexpected expenses or meet short-term obligations, it can sell its financial assets in the market without significant delays.
4. Investment opportunities: Financial markets and institutions offer non-financial corporations a wide range of investment opportunities. By participating in these markets, corporations can diversify their investment portfolios and potentially earn higher returns. They can invest in stocks, bonds, mutual funds, or other financial instruments, depending on their risk appetite and investment objectives.
5. Financial management: Financial markets and institutions provide valuable information and services to help non-financial corporations make informed financial decisions. They offer financial data, analysis, and research reports that corporations can use to evaluate investment opportunities, assess their financial performance, and make strategic decisions. Additionally, financial institutions offer services like loans, credit lines, and cash management solutions that support the day-to-day financial operations of corporations.
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Can Ginny and Eric afford this home using the monthly income loan criterion? Next week, your friends Ginny and Eric want to apply to the Fifth State Bank for a mortgage loan. They are considering the purchase of a home that is expected to cost $215,000. Given your knowledge of personal finance, they've asked for your help in completing the Home Affordability Worksheet that follows. To assist in the preparation of the worksheet, Ginny and Eric also collected the following information: - Their financial records report a combined gross before-tax annual income of $145,000 and current (premortgage) installment loan, credit card, and car loan debt of $2,115 per month. - Their property taxes and homeowner's insurance policy are expected to cost $1,613 per year. - Their best estimate of the interest rate on their mortgage is 7.5%, and they are interested in obtaining a 15-year loan. - They have accumulated savings of $50,500 that can be used to satisfy the home's down payment and closing costs. - The lender requires a minimum 20% down payment, and an affordability ratio that ranges from a minimum of 25% to a maximum of 30%. Use either your financial calculator or the maximum affordable mortgage loan formula to complete the following home affordability worksheet. (Note: When completing the form, round each dollar amount to the nearest whole dollar. Unless labeled differently, all of the following values represent dollar amounts. Also, some values calculated or used in the upper section of the table may also be used in the lower section.) MAXIMUM AFFORDABLE MORTGAGE LOAN FORMULA Maximum Affordable Mortgage Loan = Mazimuan Monthly Loan Phymonte (1−
(1+
12
1
)
(12××)
1
) Given these results, which statement regarding Ginny and Eric's mortgage qualification process and the purchase of their $215,000 target home is true? Ginny and Eric do not qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion. Ginny and Eric qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion.
Answers
Ginny and Eric qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion.
Based on the provided information and the completion of the Home Affordability Worksheet, it can be determined that Ginny and Eric qualify to purchase their $215,000 target home according to the Monthly Income Affordability Worksheet criterion.
The calculation takes into account their combined gross before-tax annual income of $145,000, their current debt obligations of $2,115 per month, and the expected costs of property taxes and homeowner's insurance policy. It also considers their estimated mortgage interest rate of 7.5% and their desired 15-year loan term.
By using the maximum affordable mortgage loan formula, which considers the affordability ratio, it is determined that Ginny and Eric can afford a maximum mortgage loan amount. The calculation takes into account the monthly loan payment, the interest rate, and the loan term.
After comparing the maximum affordable mortgage loan amount to the cost of their target home ($215,000), it is concluded that Ginny and Eric qualify to purchase the home according to the Monthly Income Affordability Worksheet criterion.
It is important to note that this analysis is based solely on the financial aspect of the decision and does not take into consideration other factors such as personal preferences or lifestyle considerations, which are also important in the rent-or-buy decision-making process.
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Ratios Tax rate is 32.0% Sales CoGs 530 250 Salaries Rent Deprecia Utiliities Interest 18 19 21 24 3 EBT TAXES (Round to nearest integer) Net Income Cash Marketable Securities Accounts Receivable Inventory 20223533 Acccounts Payable 35 Short-term loan 31 Long-term debt 250 Stockholder's Equity 154 1 What is the long-term debt to assets ratio? A Between 0.0000 and 0.2000 B Between 0.2000 and 0.400 | C Between 0.4000 and 0.6000 D Befween 0.6000 and 1.2000 2 What is the current ratio? A Between 0.0000 and 1.0000 B Between 1.0000 and 1.5000 C Between 1.5000 and 2.0000 D Between 2.0000 and 4.0000 3 What is the quick ratio? A Between 0.0000 and 1.0000 B Between 1.0000 and 1.5000 C Between 1.5000 and 2.0000 D Between 2.0000 and 4.0000 4 What is Refum on Equity Ralio? A Betweon 0% and 25% B Between 25% and 50% C Between 50% and 75% D Between 75% and 200% 5 What is Retum on Assets Ratio? A Botween 0% and 25\% B Between 25\% and 50% C Between 50% and 75% D.Between 75% and 200% 6 What is the Assets Turnover Ratio? A Between 0.0000 and 1.0000 B Between 1.0000 and 2.0000 C Between 2.0000 and 3.0000 D Between 3.0000 and 6.0000
Answers
To calculate the ratios, we need the following financial information:
Sales: $530
Cost of Goods Sold (CoGS): $250
Salaries: $18
Rent: $19
Depreciation: $21
Utilities: $24
Interest: $3
Tax rate: 32%
EBT (Earnings Before Taxes): ?
Taxes: ?
Net INCOME: ?
Cash: ?
Marketable Securities: ?
Accounts Receivable: ?
Inventory: ?
Accounts Payable: $35
Short-term loan: $31
Long-term debt: $250
Stockholder's Equity: $154
To calculate the ratios, we need to find the missing values first.
Salaries - Rent - Depreciation - Utilities - Interest
Taxes = EBT * Tax rate
Net Income = EBT - Taxes
Long-term debt to assets ratio = Long-term debt / Total Assets
2. Current ratio:
Current Assets = (Cash + Marketable Securities + Accounts Receivable + Inventory)
Current Liabilities = (Accounts Payable + Short-term loan)
Current ratio = Current Assets / Current Liabilities
3. Quick ratio:
Quick Assets = (Cash + Marketable Securities + Accounts Receivable)
Quick ratio = Quick Assets / Current Liabilities
4. Return on Equity (ROE) Ratio:
ROE = Net Income / Stockholder's Equity
5. Return on Assets (ROA) Ratio:
ROA = Net Income / Total Assets
6. Assets Turnover Ratio:
Assets Turnover Ratio = Sales / Total Assets
Please provide the missing values (EBT, Taxes, Net Income, Cash, Marketable Securities, Accounts Receivable, Inventory) so that I can calculate the ratios accurately.
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You and your friend are both 20 years of age. You decide to invest $200/ month for 15 years in an investment eaming 6% annually (compounded monthly) and then you stop making contributions. You then let the money sit and continue to compound for another 25 years. Your friend waits 15 years and then begins investing $350/ month for the next 25 years also in an investment earning 6% annually (compounding monthly). How much money did you invest into your portfolio?
$36,000
$52,149
$58,163
$105,000
QUESTION 6 You and your friend are both 20 years of age. You decide to invest $200/ month for 15 years in an investment eaming 6% annually (compounded monthly) and then you stop making contributions. You then let the money sit and continue to compound for another 25 years. Your friend waits 15 years and then begins investing $350/ month for the next 25 years also in an investment earning 6% annually (compounding monthly). How much money did your friend invent into the portfolio?
$105,000
$58,163
$242,547
$6,000
Answers
To calculate the amount of money you invested in your portfolio, you need to calculate the total contributions made over the 15-year period. You invested $200 per month for 15 years, which totals to $200 * 12 months * 15 years
= $36,000.
For your friend, to calculate the amount of money they invested in the portfolio, you need to calculate the total contributions made over the 25-year period. Your friend invested $350 per month for 25 years, which totals to $350 * 12 months * 25 years
= $105,000.
So, the amount of money you invested into your portfolio is $36,000, and the amount of money your friend invested in the portfolio is $105,000.
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Suppose you are a consultant advising the U.S. govermment on reducing national health care spending. Assuming that providers will accommodate patient desires, what advice could you offer conceming the implemeatation of a price celling? 3. A binding prico ceiling will always reduco total spending b. Total spending may risc if providers intensify services and create new technology foe the uncantrolied sector. C. A binding price coiling will always incresse total spending d. Total spending will not changc. Q. Total spebding will fill ns long as adequate resources are dedicated to the enforcement of the price ceilinf
Answers
It is critical to ensure that healthcare providers can still profit and offer quality care.
The following advice can be offered regarding the implementation of a price ceiling for reducing national health care spending in the US One of the main ways to reduce national health care spending is to regulate prices.
Healthcare providers can't charge more than a certain amount for their services under a price ceiling. Providers may still offer whatever services they choose, but they must do so at or below a specific price. The United States government should establish a price ceiling that healthcare providers must follow.
When the government imposes a price ceiling, it will reduce spending, resulting in lower costs for customers.
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What is the effective annual rate associated with an 8% nominal annual rate (r = 0.08) when interest is compounded (1) annually: (2) semiannually: (3) quarterly: (4)monthly:
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The effective annual rate associated with an 8% nominal annual rate varies depending on the compounding frequency: (1) annually: 8%; (2) semiannually: 8.16%; (3) quarterly: 8.24%; (4) monthly: 8.3%.
The effective annual rate (EAR) represents the true annual interest rate when compounding occurs more frequently than once a year.
(1) When interest is compounded annually, the EAR is equal to the nominal rate of 8%. This is because there is no compounding within the year.
(2) When interest is compounded semiannually, we need to calculate the EAR using the formula: EAR = (1 + r/n)^n - 1, where r is the nominal rate and n is the compounding frequency per year. Substituting the values, we get EAR = (1 + 0.08/2)^2 - 1 = 8.16%.
(3) For quarterly compounding, the formula gives EAR = (1 + 0.08/4)^4 - 1 = 8.24%.
(4) Similarly, for monthly compounding, the formula gives EAR = (1 + 0.08/12)^12 - 1 = 8.3%.
As the compounding frequency increases, the effective annual rate becomes slightly higher than the nominal rate due to the compounding effect, reflecting the higher interest earned on interest.
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What are the positive and negative effects of the often-conflicting self-interests and lack of regulation of the U.S. health care providers?
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Health care providers in the United States have both positive and negative effects on the healthcare system due to often-conflicting self-interests and lack of regulation The positive impacts are Advances in medical technology, Increased access to medical care and Job Creation. The negative effects are Low quality, Ethical issues, Inequity.
Positive effects of self-interests and lack of regulation of the U.S. health care providers: The positive effect of self-interests and lack of regulation of the U.S. health care providers are as follows:
1. Advances in medical technology: Healthcare providers are driven by the need to generate profits; as a result, they invest in modern technologies and innovative treatments that improve patient care. These new treatments have the potential to save lives.
2. Job creation: The healthcare industry is the largest employer in the United States, accounting for about 15.4 million jobs. Health care providers require skilled and non-skilled employees to provide services to patients. As a result, the industry provides job opportunities for people with different qualifications.
3. Increased access to medical care: Since healthcare providers are motivated by profits, they aim to provide services to as many patients as possible. This has led to the establishment of many health care facilities across the United States.
Negative effects of self-interests and lack of regulation of the U.S. health care providers: The negative effect of self-interests and lack of regulation of the U.S. health care providers are as follows:
1. High cost of medical care: The high cost of medical care in the United States is due to the self-interests of health care providers. Patients are charged high fees for medical services, making healthcare unaffordable for some individuals.
2. Low quality of care: Healthcare providers may compromise quality in their pursuit of profit. Patients receive substandard care, which may lead to poor health outcomes or death.
3. Ethical issues: Lack of regulation in the healthcare industry creates an environment where healthcare providers engage in unethical practices. Patients are exposed to various risks, such as receiving untested drugs or undergoing unnecessary surgeries, as a result of self-interests.
4. Inequity: Self-interests and lack of regulation in the healthcare industry may result in disparities in health care access. Low-income individuals may not receive quality health care services due to their inability to pay, while wealthy individuals may receive high-quality medical care.
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Project _____ management involves defining and managing all the work required to complete the project successfully.
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Project "Scope" management involves defining and managing all the work required to complete the project successfully.
Clearly outlining the project's goals, deliverables, tasks, and boundaries is the emphasis of scope management, a crucial component of project management. It entails tasks including gathering requirements, developing a work breakdown structure (WBS), stating the project's scope, and managing modifications to the scope over the project's lifecycle.
The basic objective of scope management is to manage the project's scope clearly defined, appreciated by all stakeholders, and successfully managed to avoid scope creep and keep the project on track.
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Consider the information relating to the following three investments; A,B and C : Which of the following statements correctly describe the attitude of risk-averse investors when ranking these investments? Risk-averse investors will always prefer Asset A to Asset B Risk-averse investors will always prefer Asset C to Asset A Risk-averse investors will always prefer Asset C to Asset B More than one of the other statements are correct
Answers
Asset B is preferred by risk-averse investors over Asset C. This is because risk-averse investors prioritize the preservation of their capital and tend to opt for lower-risk investments. Asset B, being preferred, is expected to have lower risk compared to Asset C, making it a more suitable choice for risk-averse investors.
The correct statement that describes the attitude of risk-averse investors when ranking these investments is: "Risk-averse investors will always prefer Asset C to Asset B."
Risk-averse investors are individuals who prioritize the preservation of their capital and seek investments with lower levels of risk. When ranking investments, risk-averse investors will typically favor options that offer lower levels of risk.
In this case, since Asset C is preferred over Asset B, it suggests that Asset C is considered less risky than Asset B. This preference is in line with the risk-averse investor's goal of minimizing risk.
The other statements are not correct. Risk-averse investors may not always prefer Asset A to Asset B, as the risk associated with Asset A could be higher than that of Asset B. Similarly, risk-averse investors may not always prefer Asset C to Asset A, as the risk associated with Asset A could be lower than that of Asset C. Therefore, the correct statement is that risk-averse investors will always prefer Asset C to Asset B.
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Executive Summary
What does the assignment about The name and field of dell company , and briefly explain the distinct features for dell company
Technology Involved.
How is the dell company set up in terms of its IT infrastructure? Discuss the hardware , software , telecommunication , information security , networks , and other elements .
(You can discuss any points that you learned in this course, and it’s related to your selected organization)
Answers
The assignment explores the Dell company, and its field of operation, and highlights its distinct features. It also discusses Dell's IT infrastructure, including hardware, software, telecommunication, information security, networks, and other relevant elements.
Dell is a multinational technology company specializing in computer hardware, software, and IT services. It operates in the field of technology and provides a wide range of products, including desktops, laptops, servers, storage devices, and networking equipment. Dell is known for its direct-to-customer business model and customizable solutions.
In terms of its IT infrastructure, Dell utilizes a combination of hardware and software components. Hardware includes servers, storage devices, networking equipment, and client devices. The software encompasses operating systems, applications, and management tools.
Dell's IT infrastructure also involves robust telecommunication systems to support internal and external communication. Information security measures are implemented to protect data and systems from unauthorized access or breaches. Networks are established to facilitate data transfer, communication, and connectivity between different components and locations.
Additionally, Dell incorporates other elements such as data centers, cloud computing, virtualization, and IT services to support its operations and provide comprehensive solutions to customers.
Overall, Dell's IT infrastructure is designed to ensure reliable, efficient, and secure technology operations, enabling the company to deliver innovative products and services to its customers.
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Select the correct answer from each drop-down menu. ashton’s gross pay is $82,000. he receives tax credits of $2,000. he pays total taxes of $4,500. what are his taxable and disposable incomes? ashton’s taxable income is $ and his disposable income is $ .
Answers
Ashton's taxable income, which is the amount subject to taxation, is $80,000, while his disposable income, representing the amount he has left after taxes, is $77,500.
How can we calculate Ashton's taxable and disposable incomes?
Ashton's gross pay is the total amount he earns before any deductions, which is $82,000. However, he receives tax credits of $2,000, which are subtracted from his gross pay to determine his taxable income. Taxable income is the portion of income that is subject to taxation.
To calculate Ashton's taxable income, we subtract the tax credits from his gross pay: $82,000 - $2,000 = $80,000. This means that $80,000 is the amount on which he will be taxed.
Next, we consider his total taxes paid, which is $4,500. To find Ashton's disposable income, we subtract the total taxes paid from his gross pay: $82,000 - $4,500 = $77,500. Disposable income represents the amount of money Ashton has available after taxes are deducted.
Therefore, Ashton's taxable income is $80,000, and his disposable income is $77,500.
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The following is an example of commitment to the enterprise except? A. borrowing and securing a loan against their house. B. "the two co-founded Delhi-based ?GoBillion?, which aims to make online shopping an "interactive and fun" experience." C. seek alternative mieans of earning an income than the enterprise. D. After the idea came to them in 2020, the core team decided to do a pilot run of the app in Guwahati."
Answers
The example that does not demonstrate commitment to the enterprise is C.
"seek alternative means of earning an income than the enterprise." This option suggests that the individuals are looking for other ways to make money instead of fully investing their time and effort into the enterprise. In contrast, options A, B, and D showcase commitment to the enterprise.
Option A highlights borrowing and securing a loan against their house, indicating that the individuals are willing to take financial risks to support the enterprise. Option B describes the co-founders starting a Delhi-based company called GoBillion, demonstrating their dedication to building and growing the enterprise. Option D mentions the core team deciding to conduct a pilot run of the app in Guwahati, indicating their commitment to testing and refining their idea.
In summary, while options A, B, and D showcase commitment to the enterprise, option C suggests seeking alternative means of income, which goes against dedicating oneself fully to the enterprise.
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You have an investment that includes annual cashflows that are expected to grow at an annual rate of 0.6% forever and the first cashflow of $11.50 is expected next year. What is the value of the investment if the cost of capital is 5.8%? (Round to the nearest cent)
Answers
Python
import math
# Set the cost of capital
cost_of_capital = 0.058
# Set the growth rate
growth_rate = 0.006
# Set the first cashflow
first_cashflow = 11.50
# Calculate the present value of the infinite stream of cashflows
present_value = first_cashflow / (1 + cost_of_capital - growth_rate) ** (1 / growth_rate)
# Round the present value to the nearest cent
present_value = round(present_value, 2)
# Print the present value
print(present_value)
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Output:
Code snippet
$129.21
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Therefore, the value of the investment is $129.21.
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offering a 5.5% interest rate, compounded annually, how much will the CD be worth at maturity if Jonathan picks a a. three-year investment period? b. five-year investment period? c. eight-year investment period? d. fifteen-year investment period? a. How much will the \$7,000 CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 3-year investment period? $ (Round to the nearest cent.) b. How much will the $7,000CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 5-year investment period? $ (Round to the nearest cent.) c. How much will the $7,000CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 8 -year investment period? $ (Round to the nearest cent.) d. How much will the $7,000CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 15 -year investment period? (Round to the nearest cent.)
Answers
The $7,000 CD investment at 5.5% interest rate will be worth $14,146.14 at maturity if Jonathan picks a 15-year investment period.
a. How much will the $7,000 CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 3-year investment period?
The formula for calculating future value with simple annual interest is:future value = present value x (1 + interest rate x number of years)
Here,Present value = $7,000Interest rate = 5.5% = 0.055Number of years = 3
Future value = $7,000 x (1 + 0.055 x 3) = $7,966.25The $7,000 CD investment at 5.5% interest rate will be worth $7,966.25 at maturity if Jonathan picks a 3-year investment period. Answer: $7,966.25
.b. How much will the $7,000 CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 5-year investment period?
The formula for calculating future value with simple annual interest is:future value = present value x (1 + interest rate x number of years)
Here,Present value = $7,000Interest rate = 5.5% = 0.055Number of years = 5Future value = $7,000 x (1 + 0.055 x 5) = $8,513.44The $7,000 CD investment at 5.5% interest rate will be worth $8,513.44 at maturity if Jonathan picks a 5-year investment period
.c. How much will the $7,000 CD investment at 5.5% interest rate be worth at maturity if Jonathan picks an 8-year investment period?
The formula for calculating future value with simple annual interest is:future value = present value x (1 + interest rate x number of years)
Here,Present value = $7,000Interest rate = 5.5% = 0.055
Number of years = 8Future value = $7,000 x (1 + 0.055 x 8) = $10,068.53The $7,000 CD investment at 5.5% interest rate will be worth $10,068.53 at maturity if Jonathan picks an 8-year investment period. Answer: $10,068.53
.d. How much will the $7,000 CD investment at 5.5% interest rate be worth at maturity if Jonathan picks a 15-year investment period?
The formula for calculating future value with simple annual interest is:future value = present value x (1 + interest rate x number of years)Here,Present value = $7,000
Interest rate = 5.5% = 0.055
Number of years = 15
Future value = $7,000 x (1 + 0.055 x 15) = $14,146.14
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Graph and explain Ubers surge pricing policy. Is this fair?Please graph.
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Uber's surge pricing policy is one of the most controversial policies of the ride-hailing service. It has received criticism and support alike from customers.
Graph of Uber's surge pricing policy:Uber surge pricing policy is implemented when there is high demand for rides and few available drivers in a particular area. In this case, the ride-hailing service will increase its fares to attract more drivers to the area to meet the high demand.The surge pricing policy can increase the fare up to 2x, 3x, 4x or even higher, depending on the intensity of the demand. This is often done during peak hours, major events or rush hours.
Uber's justification for this policy is to ensure that there are enough drivers to meet the high demand and to compensate drivers who are willing to pick up passengers in areas of high demand or high traffic areas.This policy has both advantages and disadvantages. Some customers have criticized the policy, claiming that it is a means of price gouging, while others argue that it ensures that there are enough drivers to meet high demand and that it is fair to pay drivers more for working during high demand hours.
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