What would be the entry in the payoff table for situation

Assignment Help Financial Management
Reference no: EM131448336

The Claus Christmas Tree Company must order Christmas trees for the upcoming season. They order trees that are fairly uniform in size and in species. The trees cost them $20 each and they sell them to the public for $30. They don't believe that there is any ill will towards them if they run out of trees. If they have any leftover trees on Christmas Eve, they sell the trees for $7 each, and are confident that they can sell any remaining trees at this reduced price. To simplify their decision, they assume that demand will be in increments of 100s. They believe that demand will be at least 300 and no greater than 600. What would be the entry in the payoff table for the situation where Sandy orders 600 trees and the demand is 400?

Reference no: EM131448336

Questions Cloud

Explain how interest rates influence : Crissie just won the lottery, and she must choose among three award options. She can elect to receive a lump sum today of $61 million, to receive 10 end-of-year payments of $9 5 million, or to receive 30 end-of-year payments of $5 5 million. Explain ..
The bond to create a synthetic stock and the stock : Stock XYZ trades at a current level of S0 = 120, the continuously compounded dividend yield is 2.5%, the continuous interest rate is 4%. The stock XYZ paying the continuously compounded dividend yield of 2.5% there are no dividends use the forward an..
Find the interest earned : The principal represents an amount of money deposited in a savings account subject to compound interest at the given rate. Principal $3000 Rate 8 % Compounded annually Time 5 years. Find the interest earned.
Saving for retirement with the first payment : Your client is 40 years old. She wants to begin saving for retirement with the first payment to come one year from now. She can save $5,000 per year, and you advise her to invest it in the stock market, which you expect to provide an average return o..
What would be the entry in the payoff table for situation : The Claus Christmas Tree Company must order Christmas trees for the upcoming season. They order trees that are fairly uniform in size and in species. What would be the entry in the payoff table for the situation where Sandy orders 600 trees and the d..
Find the value of a british consol : Find the value of a British consol that pays $25 per year in perpetuity. The interest rate on investments of comparable risk is 5.2%. What is the present value of an investment that will pay $100 per year forever if the required rate is 10%?
What is the present value of your retirement plan : You belong to an unusual pension plan because your retirement payments will continue forever (and will go to your descendants after you die). If you will receive $24,000 per year at the end of each year starting 30 years from now (i.e., the first pay..
Annual payment-ordinary annuity instead of perpetuity : You are willing to pay $15,625 to purchase a perpetuity that will pay you and your heirs $1,250 each year, forever. If your required rate of return does not change, how much would you be willing to pay if this were a 20-year annual payment, ordinary ..
Assets value and liabilities value : Assets Value Liabilities Value Savings account $9,000 Mortgage balance $88,704 Checking account $2,000 Credit card balances $3,200 6-month CD $2,500 Car loan $9,500 Principal residence $367,000 Car $12,000 Total assets $403,500 Personal property $11,..

Reviews

Write a Review

Financial Management Questions & Answers

  What was average real risk-free rate over time period

You’ve observed the following returns on Crash-n-Burn Computer’s stock over the past five years: 15 percent, –15 percent, 17 percent, 27 percent, and 10 percent. Suppose the average inflation rate over this period was 1.6 percent and the average T-bi..

  Cost to guarantee yourself one seat on board of directors

The shareholders of Motive Power Corp. need to elect four new directors to the board. There are 14,700,000 shares of common stock outstanding, and the current share price is $11.00. If the company uses cumulative voting procedures, how much will it c..

  Use the federal funds rate as its policy instrument

When choosing a policy instrument, the Fed uses the criteria of the instrument being measurable, controllable, and predictable.

  How much in dividends were paid to shareholders

In its most recent financial statements, Nessler Inc. reported $89,086,003 of net income and $817,799,773 of retained earnings. The previous year retained earnings were $763,748,438. How much in dividends were paid to shareholders during the year? As..

  Project with an expected cash inflow

Wilson, Inc., has a project with an expected cash inflow of $1 million at the end of Year 5. Wilson has a second project with an expected cash inflow of $200,000, to be received at the end of each year for the next five years. Required: If both proje..

  Should reynolds lease or buy the equipment

Assume that Reynolds’s tax rate is 40% and that the equipment's depreciation would be $100 per year. If the company leased the assets on a 2 year lease, the payment would be $110 at the beginning of each year. If Reynolds borrowed and bought, the ban..

  Interest income is distributed

Arnold Ziffle established a trust fund that provides $75,000 in scholarships each year for worthy students. The trust fund earns a 5 percent rate of return. How much money did Ziffle contribute to the fund assuming that only the interest income is di..

  Banks savings and loan offering an introductory rate

You receive a credit card application from Shady Banks Savings and Loan offering an introductory rate of .5 percent per year, compounded monthly for the first six months, increasing thereafter to 16.2 percent compounded monthly. Assume you transfer t..

  Two years after the bonds were issued

Alibaba Company Limited sold an issue of bonds with a 10-year maturity, a $1,000 par value, a 10 percent coupon rate, and semiannual interest payments. Two years after the bonds were issued, the going rate of interest on bonds such as these fell to 6..

  Getting better as the series winds down kevin connolly

getting better as the series winds down. kevin connolly directs the episode as we move forward with the storylines.

  Make in order to partake of future cybernetic goodness

You estimate that you will need $716 thousand in 30 years to buy some cybernetic body enhancements, including infrared vision, retractable claws, and expanded brain storage capacity. To achieve your financial goal, you want to make three equal-sized ..

  What is the net present value of this car transaction

Suppose you want to buy a car for college. Your awesome uncle is willing to sell you his $20,000car which he no longer needs. He will only charge you 1% interest per year on the value of the car. Assuming 10 equal annual payments, what is the payment..

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