Predetermined annual price

Assignment Help Finance Basics
Reference no: EM131015677

Pivotal's Spinnaker software at a predetermined annual price of $ 450 M. Currently Netflix uses Amazon's AWS product and pays $ 400 M annually, but each year this value can go up 20% or down 10% in comparison with the previous year. Over the next three years at the beginning of each year Netflix can decide, which product, Spinnaker or AWS, it will be using that year. Which product should the company use each year? If the risk-free rate is 3%, how much this agreement is worth to Pivotal?

Reference no: EM131015677

Questions Cloud

What mass in grams of chlorine gas : What mass, in grams, of chlorine gas (Cl2) is contained in a 15.5 liter tank at 25.5 degrees Celsius and 1.98 atmospheres can you walk me through the steps?
What is the current in the circuit : A 7-V battery is connected across a 70-omegacap.gif resistor and a 288-mH inductor. What is the current in the circuit if the battery has been connected for a long time?
How many moles of kcl : How many moles of KCl are required to prepare 1.50 L of 5.4 M KCl?
How does plaque harm teeth : How does plaque harm teeth? Explain in detail? How does fluoride promote dental health?
Predetermined annual price : Pivotal's Spinnaker software at a predetermined annual price of $ 450 M. Currently Netflix uses Amazon's AWS product and pays $ 400 M annually, but each year this value can go up 20% or down 10% in comparison with the previous year.
Economy produces its potential output in the long run : What is price-wage rigidity? Do you agree with Keynes assessment that wage-price rigidity requires government's involvement in the markets? Why? Why not?
Potassium nitrate to test for fluoride in mouth wash : Can you use potassium nitrate to test for fluoride in mouth wash? Explain you answer?
Difference between worldwide-territorial tax policies : Please define and Explain the difference between Worldwide and Territorial tax policies. (B) Please define and explain current US tax policy relative to overseas profit. ( C ) Assume Company A has two foreign subsidiaries, X and Y. Company A has a..
Consider the formation of silver oxide : Consider the formation of silver Oxide (Ag2O) from its elements. At 298K,  ΔGf° = -11.3kJ/mol and ΔHf° = -31.1 kJ/mol. At a very low partial pressure of oxygen of p(O2) = 10-6atm, is the formation of silver oxide spontaneous in the reverse direction?..

Reviews

Write a Review

 

Finance Basics Questions & Answers

  Market on a downward trend

The value at which an investor will sell a security. The value a purchaser is willing to pay for a security is the bid. The difference between the ask and bid price is the spread.

  The firm is considering adding a mid-class spa and expects

cool comfort currently sells 300 class a spas 450 class c spas and 200 deluxe model spas each year. the firm is

  What is the required after-tax refunding investment outlay

What is the required after-tax refunding investment outlay, that is, the cash outlay at the time of the refunding?

  What is the standard error of the mean

Assume the distribution of the length of the cuts follows the normal distribution with a population standard deviation of 8 seconds. Suppose we select a sample of 16 cuts from various cds sold by cra cds, inc.

  What coupon rate should the bonds have

There is a 60 percent probability that long-term interest rates one year from today will be 13 percent, and a 40 percent probability that they will be 9 percent. Assume that if interest rates fall the bonds will be called. What coupon rate should ..

  Maintain a minimum balance

Randy, a student, has $500 to deposit in a new checking account, but Randy knows he will not be able to maintain a minimum balance. He will not use an ATM card, but will write a large number of checks.

  Airbus plant relocation

Airbus announced it was building a new plant in Alabama. Can you assist me in answering the following questions based on information in conjunction with Foreign Direct Investment.

  A company releases a five-year bond with a face value of

a company releases a five-year bond with a face value of 1000 and coupons paid semiannually. if market interest rates

  The support of ideas of ancient philosophies

Need help on writing this short essay about if the pre modern women can achieve good life, with the support of ideas of ancient philosophies.

  What is the payback in years

Find the IRR for a project consting $36,500 and returning $5,000 annually for the first 4 years, followed by $11,000 annually for 3 years. Also what is the payback in years?

  Determine the value of the probability

Now to determine the value of the probability of A and B, we need to figure out if the events are independent or dependent.

  What is implicitly occurring in each as a result of interest

what is implicitly occurring in each as a result of interest rate parity? Is the pound selling forward at a premium or at a discount relative to the yen?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd