Problem 10-3 eastman publishing company is considering publishing an electronic textbook about spreadsheet applications for business. the fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $160,000. variable processing costs are estimated to be $6 per book. the publisher plans to sell single-user access to the book for $46. (a) build a spreadsheet model in excel to calculate the profit/loss for a given demand. what profit can be anticipated with a demand of 3,500 copies? for subtractive or negative numbers use a minus sign.

Highland company produces a lightweight backpack that is popular with college students. standard variable costs relating to a single backpack are given below

Suppose you win a small lottery and have the choice of two ways to be paid: you can accept the money in a lump sum or in a series of payments over time. if you pick the lump sum, you get $2,950 today. if you pick payments over time, you get three payments: $1,000 today, $1,000 1 year from today, and $1,000 2 years from today. 1) at an interest rate of 6% per year, the winner would be better off accepting the (lump sum / payments over time), since it has the greater present value. 2) at an interest rate of 9% per year, the winner would be better off accepting the (lump sum / payments over time), since it has the greater present value. 3) years after you win the lottery, a friend in another country calls to ask your advice. by wild coincidence, she has just won another lottery with the same payout schemes. she must make a quick decision about whether to collect her money under the lump sum or the payments over time. what is the best advice to give your friend? a) the lump sum is always better. b) the payments over time are always better. c) it will depend on the interest rate; advise her to get a calculator. d) none of these answers is good advice.

Why is investing in a mutual fund less risky than investing in a particular company’s stock?