Ask question

Ask question

All categories

2 years ago

11

Brittany needs to buy some term life insurance. She has evaluated two 20-year fixed premium policies. One policy will cost $30 a

month for $100,000 in coverage. The other will cost $40 a month for $150,000 in coverage. Which policy is a better deal?

1 answer:

fenix001 [56]2 years ago

3 0

The best answer is 30$ to 100,000$ hope it helps

You might be interested in

Suppose a manufacturing plant is considering three options for expansion. The first one is to expand into a new plant (large), t

sp2606 [1]

Answer:

a. $50,000

b. $77,500

c. $27,500

d. Large expansion or plant

Explanation:

a. What is the highest Expected Monetary Value (EMV)?

1. EMV of Large expansion = ($100000×0.50) + ($10000×0.25) + (-$10000×0.25)

EMV of Large expansion =

2. EMV of Medium expansion = ($40000×0.50) + ($40000×0.25) + ($5000×0.25)

EMV of Medium expansion = $31,250

3. EMV of Small expansion = ($15000×0.50) + ($15000×0.25) + ($15000×0.25)

EMV of Small expansion = $15,000

The highest EMV is $50,000 which is the EMV of Large expansion.

b. What is Expected Value with Perfect Information (EVwPI)?

EVwPI is obtained by adding together the expected value of the highest profit from each of the expansions as follows:

EVwPI = ($100000×0.50) + ($40000×0.50) + ($15000×0.50)

EVwPI = $77,500

c. What is the organization willing to pay for perfect information?

This requires the calculation of Expected Value of Perfect Information (EVPI). This can be obtained as follows:

EVPI = EVwPI - EVwoPI

Where EVwoPI denotes Expected Value without Perfect Information and it is is the highest EMV of $50,000 which is the EMV of Large expansion obtained in a above.

Substituting the figures, we have:

EVPI = $77,500 - $50,000 = $27,500

d. Which of the expansion plans should the manager choose?

The manager should choose the large expansion because it has the highest or maximum EMV of $50,000.

4 0

1 year ago

Read 2 more answers

Rosita's Restaurante has sales of $4,500, total debt of $1,300, total equity of $2,400, and a profit margin of 5 percent. What i

Rus_ich [418]

Answer:

6.08%

Explanation:

Rosita's restaurant has a sales of $4,500

The total debt is $1,300

The total equity is $2,400

The profit margin is 5%

=5/100

= 0.05

Therefore the return on assets can be calculated as follows

= profit margin×sales/total debt +total equity

= 0.05×$4,500/($1,300+$4,200)

= 225/3,700

= 0.0608×100

= 6.08%

Hence the return on assets is 6.08%

5 0

2 years ago

The amount of money collected by a snack bar at a large university has been recorded daily for the past five years. Records indi

disa [49]

Answer:

A) skewed to the right with a mean of $4000 and a standard deviation of $450.

Explanation:

While the days are picked at random, the size of the sample is enough to represent the reality. Among the random pick those days of football game will be picked too and will skewed to the right the distribution

The distribution will not change into normal as the reality is that distribution of revenue is not normally distributed among the days of the year.

3 0

1 year ago

29. Maxwell is trying to decide whether to accept a salary of $60,000 or a salary of $25,000 plus a bonus of 20% of net income a

Akimi4 [234]

Answer:

Maxwell world consider choice equal to $310000

Explanation:

given data

accept a salary = $60,000

salary = $25,000

bonus = 20% of net income

to find out

amount of income would be necessary so that Maxwell would consider

solution

we get here income by bonus that is express as

bonus = 2 ( income - bonus - salary ) ..............1

3500 = 2 ( income - ( 0.2 × 35000 ) - ( 0.2 × (75000 + 35000) )

solve it we get

income = $310000

so Maxwell world consider choice equal to $310000

3 0

2 years ago

Nadine Chelesvig has patented her invention. She is offering a potential manufacturer two contracts for the exclusive right to m

Alchen [17]

Answer:

The uniform annual sales volume of the product for Nadine to be indifferent between the contracts is 7,772 units per year.

Explanation:

We have to compare the present-value of both plans to answer this question.

The Plan A has a present value of $30,000 as is an inmediate payment.

The Plan B has both an annual payment and a royalty, for a span of ten years.

The present value for Plan B is:

$PV_b=\sum_{i=1}^{10}(1000+0.50q)/(1+i)^i$

This can be simplified with a annuity factor for 10 years, with i=10%.

$A_{10}=\frac{1-(1+i)^{-10}}{i}= \frac{1-1.1^{-10}}{0.10}\\\\A_{10}=\frac{1-0.386}{0.10}=\frac{0.614}{0.10}=6.14$

Then, the PV can be calculated as:

$PV_b=6.14(1,000+0.50q)\\\\PV_b=6,140+3.07q$

To be indifferent, both present values have to be equal:

$PV_b=PV_a\\\\6,140+3.07q=30,000\\\\q=(30,000-6,140)/3.07=23,860/3.07=7,772$

The uniform annual sales volume of the product for Nadine to be indifferent between the contracts is 7,772 units per year.

6 0

1 year ago