Business, 16.06.2020 16:57 nayo2006

Jack just inherited the family business, and having no desire to run the family business, he has decided to sell it to an entrepreneur. In exchange for the family business, Joe has been offered an immediate payment of $100,000. Joe will also receive payments of $50,000 in one year, $50,000 in two years, and $75,000 in three years. The current market rate of interest for Jack is 5%. Required:
a. In terms of present value (PV), how much will Joe receive for selling the family business?
b. A perpetuity has a PV of $20000. If the interest rate is 6%, how much will the perpetuity pay every year?

Answers: 1

Show answers

Another question on Business

Business, 22.06.2019 12:50

Kyle and alyssa paid $1,000 and $4,000 in qualifying expenses for their two daughters jane and jill, respectively, to attend the university of california. jane is a sophomore and jill is a freshman. kyle and alyssa's agi is $135,000 and they file a joint return. what is their allowable american opportunity tax credit after the credit phase-out based on agi is taken into account?

Answers: 1

Answer

Business, 22.06.2019 22:10

Atoy store has a new game in stock, but customers aren't buying it. which of the following types of inventory increases when customers aren't buying this game? a. work-in-process b. raw materials c. finished goods d. in-transit

Answers: 3

Answer

Business, 22.06.2019 23:30

Sally has a high-paying management position with a fortune 500 company, but she is tired of working for corporate america. so sally has decided to start a business, and she knows she will be successful as an entrepreneur because entrepreneurs typically

Answers: 3

Answer

Business, 22.06.2019 23:50

Jaguar has full manufacturing costs of their s-type sedan of £22,803. they sell the s-type in the uk with a 20% margin for a price of £27,363. today these cars are available in the us for $55,000 which is the uk price multiplied by the current exchange rate of $2.01/£. jaguar has committed to keeping the us price at $55,000 for the next six months. if the uk pound appreciates against the usd to an exchange rate of $2.15/£, and jaguar has not hedged against currency changes, what is the amount the company will receive in pounds at the new exchange rate?

Answers: 1

Answer

You know the right answer?

Jack just inherited the family business, and having no desire to run the family business, he has dec...

Questions