In order to maximize your credit score, you must have exactly ____ major credit cards. |
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Answer
3.
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2 |
In order to maximize your credit score, you must have exactly ____ major credit cards. |
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3.
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2 |
The U.S. has a ___tax system. |
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3.
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progressive |
The goal of the firm is to maximize |
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3.
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shareholder wealth |
Which form of a corporation is not subjected to double taxation? |
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4.
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Both A and B |
What percentage of your credit score is made up from your employment status? |
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1.
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An individual buying a financial security would be an |
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3.
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in financial market |
A company's current ratio should always be above: |
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Which of the following is NOT a real asset? |
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Selling price per unit
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$35
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Manufacturing cost
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$4,100 per month plus $15 per unit
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Administrative expense
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$2,410 per month plus $1.80 per unit
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Sales commissions
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11% of sales
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Advertising expense
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$1,870 per month
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$96,145
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$87,765
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$116,015
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$107,515
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Sales ($35 x 6,700)
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$234,500
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Variable expenses:
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Manufacturing ($15 x 6,700)
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$100,500
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Sales commissions (11% x $234,500)
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25,795
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Administrative ($1.80 x 6,700)
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12,060
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138,355
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Contribution margin
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96,145
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Fixed expenses:
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Manufacturing cost
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4,100
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Advertising expense
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1,870
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Administrative
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2,410
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8,380
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Net operating income
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$87,765
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Which of the following is a theoretical measure of a firm's strength? |
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Owner's equity is |
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You sell your house and make $10,000. The tax you would pay on this is: |
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capital gains |
Labeau Products, Ltd., of Perth,
Australia, has $14,000 to invest. The company is trying to decide between two
alternative uses for the funds as follows: (Ignore income taxes.)
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|
Invest
in
Project X |
Invest
in
Project Y |
Investment required
|
$14,000
|
$14,000
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Annual cash inflows
|
$6,000
|
|
Single cash inflow at
the end of 9 years
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$68,000
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Life of the project
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9
years
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9
years
|
|
The company's discount rate is
16%.
|
To determine the appropriate
discount factor(s) using tables, click here to view Exhibit 12B-1 and Exhibit 12B-2.
Alternatively, if you calculate the discount factor(s) using a formula, round
to three (3) decimal places before using the factor in the problem.
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Required:
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(1)
|
Determine the net present value. (Round your answer to the nearest dollar amount. Negative
amount should be indicated by a minus sign. Omit the "$" sign in
your response.)
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Net
Present
Value |
Project X
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$13,642
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Project Y
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$3,884
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(2)
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Which investment would you
recommend that the company accept?
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|
|
Project X
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Item
|
Year(s)
|
Amount
of
Cash Flows |
16%
Factor |
Present
Value of Cash Flows |
Project X:
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|
|
|
|
Investment
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Now
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$(14,000)
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1.000
|
$(14,000)
|
Annual
cash inflow
|
1-9
|
$6,000
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4.607
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27,642
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Net
present value
|
|
|
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$13,642
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Project Y:
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|
|
|
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Initial
investment
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Now
|
$(14,000)
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1.000
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$(14,000)
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Single
Cash inflow
|
9
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$68,000
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0.263
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17,884
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Net
present value
|
|
|
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$3,884
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Project X should be selected since
it has a higher net present value.
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