Answer:The cost of capital that will make both investments equal is 17.045%
Explanation:
Investment A
$1.5 million will be received in perpetuity we can there use perpetuity formula to Value investment A.
Value of Investment A = 1500 000/r
Investment B
$1.2 Million will be received in Investment B with a growth rate of 3% will then use Gordon's growth rate model to value investment B.
Value of investment B = (1200 000 x (1+0.03))/(r - 0.03)
Value of investment B = 1236000/(r - 0.03)
1500 000/r = 1236000/(r - 0.03)
1236000(r) = 1500000(r - 0.03)
(r - 0.03) = 1236000( r)/1500000
r - 0.03 = 0.824r
r - 0.824r = 0.03 = 0.176r = 0.03
r = 0.03/0.176 = 0.170454545
R = 17.045%
The cost of capital that will make both investments to be equal is 17.045%
Answer:
aswer is
Explanation:
because is Hp is globally science
Read the fine print, if it says “after signing, this contract is final.” Then Otto is screwed, because he must pay the $50,000
Or, Otto could hire a lawyer to fight it in court
Hope this helped ♥︎
Rounding off statistics helps the audience remember them better. There are many things that should be done when talking about statisics and going over them but out of the above choices, the most correct is making sure that the audience remembres and understands the statsitics. Statistics will not be remember by many when they are a long series of numbers even if they are as exact as it can be,
Truth in lending "trigger terms"MUST disclose amount or % of down payment and terms of repayment and APR spelled out
