Answer:
The answer is 30%
Explanation:
Solution
Given that:
Project A
Project A costs = $350
Cash flows =$250 and $250 (next 2 years)
Project B
Project B costs =$300
Cash flow = $300 and $100
Now what is the crossover rate for these projects.
Thus
Year Project A Project B A-B B-A
0 -350 -300 -50 50
1 250 300 -50 50
2 250 100 150 -150
IRR 27% 26% 30% 30%
So,
CF = CF1/(1+r)^1 + CF2/(1+r)^2
$-50 = $-50/(1+r)^1 + $150/(1+r)^2
r = 30%
CF = CF1/(1+r)^1 + CF2/(1+r)^2
$50 = $50/(1+r)^1 + $-150/(1+r)^2
r = 30%
Hence, the cross over rate for these project is 30%
Note:
IRR =Internal rate of return
CF =Cash flow
r = rate
Answer: 200 units
Explanation:
Beginning inventory 80 units.
Company Purchases <u>480 units</u>
Total 560 units
Sales <u>(360 units)</u>
Ending Inventory 200 units
200 units remain in Ending inventory.
The reason of choosing of investment with high risk instead of one with low risk because the high risks stocks, bonds are having more returns as compared to low risks, especially long term stocks.
<h3>What is high risk investment?</h3>
High risk investment is the one who have high chance of loss of capital or under-performance or have a great percentage of amount invested in some stocks.
Some high risk investments are Cryptocurrency, Individual Stocks, Initial Public Offerings, Venture Capital or Angel Investing, Real Estate and others.
Thus, The reason of choosing of investment with high risk instead of one with low risk
For more details about high risk investment, click here:
brainly.com/question/27627260
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