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Drupady [299]
2 years ago
7

E3.3 (LO 3) (Unknown Rate) HQ Ltd. purchased a used truck from Trans Auto Sales Inc. HQ paid a $4,000 down payment and signed a

note that calls for 36 payments of $1,033.34 at the end of each month. The stated rate of interest in the note is 4%. As an incentive for entering into the contract, Trans has agreed to forgive the first two payments under the lease. Instructions a. What was the purchase price of the used truck excluding the incentive given
Business
1 answer:
ivolga24 [154]2 years ago
7 0

Answer: $35,000

Explanation:

The payments of $1,033.34 at the end of every month is a constant amount which makes it an annuity.

Present value of annuity:

= Annuity * (1 - (1 + rate) ^-no. of periods) / rate

Rate needs to be made a monthly rate:

= 4%/12

= 4/12%

= 1,033.34 * ( 1 - ( 1 + 4/12%) ⁻³⁶/ 4/12%

= $35,000

Purchase price = Down payment + Present value of annuity

= 4,000 + 35,000

= $39,000

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Answer:

d. trialability

Explanation:

Based on the information provided it can be said that this strategy tries to increase the diffusion of a new product through increasing trialability. This term refers to the ease with which potential customers can test out a company's new product or service for a limited time without having to pay money for it. This allows them to determine whether the product/service is good for them and whether it is worth buying.

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2 years ago
A consulting firm has a predetermined overhead rate of $120 per labor hour. The Smith job required 5 hours to compete. The overh
andriy [413]

Answer:

overhead cost = $600

Explanation:

given data

overhead rate = $120 per labor hour

time required = 5 hours

to find out

overhead cost

solution

we get here overhead cost  that is express as

overhead cost  = overhead rate ×  time required ..............1

put here value and we get

overhead cost = $120 × 5

overhead cost = $600

6 0
2 years ago
According to the basic DCF stock valuation model, the value an investor should assign to a share of stock is dependent on the le
Alina [70]

Answer:

According to the basic DCF stock valuation model, the value an investor should assign to a share of stock is dependent on the length of time he or she plans to hold the stock.

A. True

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The DCF (Discounted Cash Flow) method of stock valuation is based on the assumption of the time-value of money.  This approach considers that the cash flow that is received today is much more than the same amount of cash flow received any other time in the future.  And the time of the future receipt or payment affects the amount of the cash flow, with decreasing consequences based on increasing time into the future.

3 0
2 years ago
Casey has ​$1 comma 000 to invest in a certificate of deposit. Her local bank offers her 2.50​% on a​ twelve-month FDIC-insured
frutty [35]

Answer:

the risk premium = return of the deposit - risk free deposit return

risk premium = 5.2% - 2.5% = 2.7% or $27 for a $1,000 CD

Besides the investment risk, Casey must also consider the inflation rate and taxes. The inflation rate lowers the real interest earned by Casey: real interest rate = nominal interest rate - inflation rate. And she must also find out how the return from the non-financial institution is taxed, if it can be taxed as capital gains or regular income.

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2 years ago
After spending months finalizing a marketing plan, the lead marketing manager presents it to the entire company. It soon becomes
Sauron [17]

The correct answer is A) alignment.

After spending months finalizing a marketing plan, the lead marketing manager presents it to the entire company. It soon becomes clear that the budget given in the plan is far lower than the marketing team had determined it would need. This mistake is likely a result of a lack of alignment.

This means that the marketing manager did not respect the parameters originally indicated. His numbers did not align with the necessities of the plan, which means that he did not take into consideration some important factors that at the end, affected the end result of the budget.

7 0
2 years ago
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