Maximum amount that the company should pay for investment

Assignment Help Business Economics
Reference no: EM13978844

Your company has the opportunity to make an investment that promises to pay $24,000 after 6 years. If your company has a required return of 8.5% on this type of investment, what is the maximum amount that the company should pay for the investment? Explain your answer.

Reference no: EM13978844

Questions Cloud

Wishes to maintain a sustainable growth rate : Fulkerson Manufacturing wishes to maintain a sustainable growth rate of 8 percent a year, a debt-equity ratio of .45, and a dividend payout ratio of 30 percent. The ratio of total assets to sales is constant at 1.3. Required: What profit margin must ..
What is the maximum percentage decline in the stock : You decide to buy 1,600 shares of stock at a price of $64 and an initial margin of 50 percent. What is the maximum percentage decline in the stock before you will receive a margin call if the maintenance margin is 35 percent?
How does this impact the strategic management : Compare and contrast approval/payment from the Patient Protection and Affordable Care Act (PPACA), commercial insurance, and the traditional Medicare program (not a Medicare health maintenance organization [HMO]) available to these types of facili..
Cash flow to stockholders : The 2014 balance sheet of Sugarpova’s Tennis Shop, Inc., showed $640,000 in the common stock account and $5.8 million in the additional paid-in surplus account. The 2015 balance sheet showed $680,000 and $6.3 million in the same two accounts, respect..
Maximum amount that the company should pay for investment : Your company has the opportunity to make an investment that promises to pay $24,000 after 6 years. If your company has a required return of 8.5% on this type of investment, what is the maximum amount that the company should pay for the investment? Ex..
I am looking for thoughtful responses : I am looking for thoughtful responses. So, one word questions (why?) and/or asking for basic information (what is your name?) don't qualify.
How far from that person is the center of mass of the desk : One side is heavier than the other, and it is found that the person exerting the larger force is exerting a vertical force of 500 N. How far from that person is the center of mass of the desk?
Discuss the mental effects of solitary confinement : Discuss some procedures that could be implemented to ensure the psychological health of prisoners in solitary confinement.
What is the workers total opportunity cost : A worker making 20$ per hour decides to take unpaid leave from work to attend a graduation ceremony. Assuming the worker works an 8 hour day has a total tax rate of 70% and receives a 5% contribution from his employer to his 401k, what is the worker'..

Reviews

Write a Review

Business Economics Questions & Answers

  Which two independent variables are statistically different

By examining the t-statistics associated with the regression coefficients, at the 5 percent significance level, which of the two independent variables are statistically different from zero?

  Manager of a corporate division faces the possibility

the manager wins with a payoff of 20, and the auditor loses with a payoff of - 20 . If the actions don't match, the auditor wins with a payoff of 20, and the manager loses with a payoff of - 20. Diagram this game and comment on the equilibrium.

  Economic profit or loss

What was the accounting profit for the new business. What was the economic profit or loss. Explain your calculations for both questions.

  How many firm a will exist in equilibrium

A firm in a competitive industry has a short run cost function= y^3-10y^2+30y. If demand= 80-P. How many firm a will exist in equilibrium?

  Country pursues an expansionary fiscal policy

Capital mobility is fairly low, so the Fe curve is less shallowly sloped than the LM curve. The currency floats. What will happen if the country pursues than the LM curve. The currency floats. What will happen if the country pursues an expansionary f..

  Firms look at that population as a large customer base

China is the world's most populous nation with 1.25 billion people. Firms look at that population as a large customer base and are rushing to establish themselves in China. Is this appropriate for all firms? Why or why not?

  What is the present worth-interest rate in the marketplace

What is the present worth of a $50,000 bond that has an interest of 20% per year payable quarterly? The bond matures in 5 years. The interest rate in the marketplace is 10% per year, compounded semiannually.

  What is the break-even price and shut-down price

The accompanying table shows a boat manufacturer’s total cost of producing boats. Quantity of Boats Total Cost 0 $ 450,000 1 $ 490,000 2 $ 510,000 3 $ 520,000 4 $ 540,000 5 $ 570,000 6 $ 610,000 7 $ 670,000 8 $ 750,000 9 $ 870,000 1.  What is the bre..

  What average price change per year for entire year period

An economist has predicted that for the next 5 years the U.S. will have an 8% annual inflation rate, followed by 5 year at a 6% inflation rate. this is equivalent to what average price change per year for the entire 10-year period?

  How to get output of seq ss in spss

How to get o/p of SEQ SS in SPSS. When we want to know sequential value which accumulate R square.

  Compare and contrast the promotional strategies

Compare and contrast the promotional strategies used by two different companies for a similar product within the category that you selected. Recommend two ways in which a company within the selected product group could use marketing information to di..

  After reading about the gold standard

After reading about the Gold Standard, William Jennings Bryan’s emotional speech, write a summary/essay analyzing what might have happened if William Bryan’s had won the 1896 election in the United States? Most likely, Jennings would have taken the U..

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