You won the lottery and can receive either 1. $60,000 today, or 2. $10,000 one year from today
plus $25,000 two years from today plus $35,000 three years from today. You plan to use the money
to pay for your child's college education in 15 years.
You should
A) take option two because you get $70,000 rather than $60,000 regardless of current interest
rates.
B) take the $60,000 today because of the time value of money regardless of current interest rates.
C) take the $60,000 today if you can earn 6.81% per year or more on your investments.
D) take the $60,000 today only if the current interest rate is at least 16.67%.
C
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John, Nathan, and Julio form JNJ, LLC (limited liability company) with an equal capital investment by each. On his way to a business meeting with the clients of JNJ, Nathan accidentally injures a woman named Jessica in a car accident
Which of the following is true in this scenario? A) Jessica can claim damages from JNJ, LLC as she was injured in the ordinary course of business. B) Jessica can only claim damages from Nathan and not from JNJ, LLC. C) Jessica can choose to claim damages from any one of the three. D) John, Nathan, and Julio have equal personal liability to Jessica's injuries.
In an interview, which of the following is not a way to identify a major point for a problem definition from an interview?
A) Users may communicate the same metaphors, such as saying the business is a journey, war, game, organism, machine, and so on. B) Users may be purposely brief when talking about the problem. C) Identifying an issue, topic, or theme that is repeated several times, sometimes by different people in several interviews. D) It may be the first thing mentioned by the user. E) Users may communicate importance by body language or may speak emphatically on an issue.
Which of the following is true of long-term funds?
A) They provide an easy way to reduce financing costs because they are relatively cheaper than short-term funds. B) They are a type of investment fund which invests in money market investments of high quality and low risk. C) They are the sources that supply the financing necessary to support a firm's capital budgeting activities. D) They are the funds available to a business on the basis of inventory held and require detailed inventory tracking.
Ibsen Company makes two products from a common input. Joint processing costs up to the split-off point total $43,200 a year. The company allocates these costs to the joint products on the basis of their total sales values at the split-off point. Each product may be sold at the split-off point or processed further. Data concerning these products appear below: Product XProduct YTotalAllocated joint processing costs$25,600 $17,600 $43,200 Sales value at split-off point$32,000 $22,000 $54,000 Costs of further processing$15,900 $17,400 $33,300 Sales value after further processing$47,500 $40,800 $88,300 Required:a.What is financial advantage (disadvantage) of processing Product X beyond the split-off point?b.What is financial advantage (disadvantage) of processing Product Y beyond
the split-off point?c.What is the minimum amount the company should accept for Product X if it is to be sold at the split-off point?d.What is the minimum amount the company should accept for Product Y if it is to be sold at the split-off point? What will be an ideal response?