BSU Inc. wants to purchase a new machine for $37,840, excluding $1,400 of installation costs. The old machine was bought five years ago and had an expected economic life of 10 years without salvage value. This old machine now has a book value of $2,200, and BSU Inc. expects to sell it for that amount. The new machine would decrease operating costs by $8,000 each year of its economic life. The straight-line depreciation method would be used for the new machine, for a six-year period with no salvage value. a) Determine the cash payback period.
b) Determine the approximate Internal rate of return.
c) Assuming the company has a required rate of return of 7%, determine whether the new machine should be purchased.

Recently, verizon wireless ran a pricing trial in order to estimate the elasticity of demand for its services. the manager selected three states that were representative of its entire service area and increased prices by 5 percent to customers in those areas. one week later, the number of customers enrolled in verizon's cellular plans declined 4 percent in those states, while enrollments in states where prices were not increased remained flat. the manager used this information to estimate the own-price elasticity of demand and, based on her findings, immediately increased prices in all market areas by 5 percent in an attempt to boost the company's 2016 annual revenues. one year later, the manager was perplexed because verizon's 2016 annual revenues were 10 percent lower than those in 2015"the price increase apparently led to a reduction in the company's revenues. did the manager make an error? yes - the one-week measures show demand is inelastic, so a price increase will decrease revenues. yes - the one-week measures show demand is elastic, so a price increase will reduce revenues. yes - cell phone elasticity is likely much larger in the long-run than the short-run. no - the cell phone market must have changed between 2011 and 2012 for this price increase to lower revenues.

Select the correct answer. joshua runs a large manufacturing business that is listed on the stock exchange. his company made good profits in the previous financial year. he now plans to reward his shareholders with handsome dividends. under which category of activities in the cash flow statement would the company’s accountants place this outflow of cash? a. investing activities b. operating activities c. financing activities d. non-operating activities

You plan to invest some money in a bank account. which of the following banks provides you with the highest effective rate of interest? hint: perhaps this problem requires some calculations. bank 1; 6.1% with annual compounding. bank 2; 6.0% with monthly compounding. bank 3; 6.0% with annual compounding. bank 4; 6.0% with quarterly compounding. bank 5; 6.0% with daily (365-day) compounding.