The market for widgets is increasing by 15% per year from current profits of $2,000,000. Investing in a design change will allow the profit per widget to stay steady; otherwise the price will drop by 3% per year. If inflation in the economy is 4%, what is the present worth in Year-1 dollars of the savings over the next 5 years? 10 years? The interest rate is 10%.

Q: The stock market has an average annual return of 10% per year. We will consider the annual return to…

A: Present Value(PV) is current value of amount to be received or paid at future date; PV is computed…

Q: 2. ABC Corporation plans to set aside $50,000 per year beginning 1 year from now for replacing…

A: Annual amount (P) = $50,000 Interest rate (r) = 10% Inflation rate (i) = 4% Period (t) = 6 Years

Q: Your project will give you a rate of return of 100% over 15 years. Is this a lot or a little? How…

A: Effective Rate is real rate at which investment value will appreciate over a given period. It shows…

Q: The value of business, currently priced at 100000 Rial, is expected to increase by 20% a year.…

A: Given information: Current Price : 100,000 Rial Increase every year : 20%

Q: You have a cash of Rs. 100,000 today. What will be its value after 5 years if you make an investment…

A: Present Value = 100,000 Time Period (N) = 5 Interest Rate = 12%

Q: Your firm has taken on cost saving measures that will provide a benefit of $11,000 in the first…

A: First year benefits (C) = $11,000 Annual growth rate (g) = - 0.03 (-3%) Interest rate (r) = 0.09…

Q: Suppose you found an investment that earns 6.0% each year. Suppose you want to withdraw 11,000…

A: Present value is the value of future cashflow at todays date discounted at specified rate. formula:…

Q: How much is the sum of the present value of the expected return over those periods

A: Cash Flows (Year 1-10) (CF) =  $15,000 per year Annual interest rate (r) = 5% Time Period (t) = 10…

Q: Your income last year was $40,000 with growth of 8% for 20 years. The discount rate is warranted at…

A: Rationale:This allocation approach balances boom capability with threat management. The fairness…

Q: Suppose that the firm Cherry Blossom has an orchard they are willing to sell today. The net annual…

A: This question is based on the concept of fair value asset pricing which says that the fair market…

Q: he market interest rate is 9 percent and is expected to stay at that level. Consumers can borrow and…

A: Annuity is regular and periodic instalment for a specific time period. Perpetuity is the annuity…

Q: You are thinking of building a new machine that will save you $ 4,000 in the first year. The machine…

A: First-year savings  = $4,000Decline rate = 3%Interest rate = 7%

Q: A stream of annual cash flows will begin 10 years from now and end 20 years from now. The initial…

A: Present value is a financial concept that represents the value of a future sum of money in terms of…

Q: Company PQR is starting a sinking fund for two future purchases. The risk free rate is 3.2%. They…

A: A sinking fund is a fund that is established to meet future debt obligations. Any individual or…

Q: How much must be invested now in order to get a return of 42000$ in 6 years time if the growth rate…

A: Data given: FV=$42000 n=6 years Rate(r)=18% p.a. compounded annually   Required: Amount to be…

Q: You have an investment that is expected to make annual payments that grow at a constant annual rate…

A: In an annuity the payments grow by a constant amount and that factor remains fixed and the same for…

Q: An investment offers a total return of 12 percent over the coming year Janice Yellen thinks the…

A: Here, Total Return is 12% Real Rate of Return is 8.8%

Q: In 10 years from now, how many future dollars will have the same buying power as $24,000 today? The…

A: Future value refers to the value of annuity at future date. It is the value determined when…

Q: In 10 years a firm will have annual cash flows of 100 million. Thereafter, its cash flows will grow…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: How much will investment accummalate to when you save 1500 every quarter for 5 years. The market…

A: A present asset's future value, abbreviated as FV, is the value that an asset is expected to have at…

Q: An economy is experiencing inflation at an annual rate of 8%. If this continues, what will P2000 be…

A: Given Annual Rate = 8% time = 3 years

Q: You have just had a big win on Powerball. You will receive $7,500,000 today, and then receive 35…

A: Present value (PV) is a financial concept used to determine the current worth of future cash flows…

Q: Cellgene Biometrics, a small biotech company, uses a MARR of 40% per year when evaluating new…

A:

Q: 7. How many years would it take for money to triple in value at 20% per yea simple interest?

A: Let the principal be x And the amount be 3x Simple interest=Amount-principal…

Q: An investment has a cost of $3500. The investment will have a payout at the end of the first year.…

A: Approach: Let's assume the desired minimum payout is P.We will roll out the yearly payout…

Q: You are offered and investment opportunity that will produce continuous income at a constant rate of…

A: Pressent value:Present value refers to the concept in finance that calculates the current worth of a…

Q: You are thinking of building a new machine that will save you $5,000 in the first year. The machine…

A: To calculate the present value we will use the below formula   Present value = P/(r+d) Where P -…

Q: Suppose you have $100,000 cash today and you can invest it to become a millionaire in 15 years. What…

A: The future value refers to the estimated value of an asset or investment at a specific point in the…

Q: You plan to buy a financial product today. You expect product will give you $100 at the end of first…

A: IRR is the internal rate of return at which the present value of cash flow is equal to the initial…

Q: In recent years, the United States has gone from being a “positive savings” notion to a “negative…

A: Borrowings are the liabilities which is used to finance the requirement of the funds. An individual…

Q: eposit $10,000 into an investment account.  You believe that you can reasonably expect a compounding…

A: The more is compounding of interest rate more is the effective interest rate and more is future…

Q: ) An office building is currently for sale, and you are thinking of purchasing it. From your…

A: Desired amount of Investment is needs to be calculated for required rate of return Income for 15…

Q: You are thinking of building a new machine that will save you $1000 in the first year. The machine…

A: Here, First year saving is $ 1000 Growth rate is -2% Interest rate = 5%

Q: The price of a car you want is $36,000 today. Its price is expected to increase by $1000 each year.…

A: TVM refers to the capacity of money to earn interest because money earned earlier is considered more…

Q: godo During next 5 years, you will invest 800 TL at the end of each quarter. If the annual interest…

A: Notes:- Present Value is the amount of money that you would need to invest today in order to have…

Q: What is the present value of aperpetuity of $50 per year if theannual interest rate is 10% andthe…

A: The objective of this question is to calculate the present value of a growing perpetuity. A…

Q: e expected average rate of return in the next decade is 4%. What is the value of $60,000 ten years…

A: The value of assets increase with time and grows to larger amount over the period of time due to the…

Q: An investment of $1,000 was made 35 years ago. What is the amount now at the market interest rate of…

A: FV  =  PV (1 + r)n where, FV  =  Future ValuePV  =  Present Valuer     =  Interest Raten    =  No.…

Q: City Garden Suppliers paid a $2 dividend yesterday. It is expected that the dividend will grow at 11…

A: The current stock price is equal to the sum of the present value of the future dividends.

Inventory Accounting

Inventory accounting is that branch of accounting that helps in determining the specific value of assets at different stages of production and development.