Response:
The yearly average return stands at 9.6 %
Clarification:
Calculating the average return
Assuming the price per share is 100
Initial Growth Final
Value % Value
Company A 50 % at 100 5,000 8 % 5,400
Company B 30 % at 100 3,000 12 % 3,360
Company C 20 % at 100 2,000 10 % 2,200
Total amounts 10,000 10,960
To find the average return, take the increase in value over the base, divided by the base
10,960 - 10,000 = 960/ 10000 = 9.6 % average return
The title of the agreement is CALIFORNIA SALES CONTRACT AND CIVIL CODE. This agreement is predominantly utilized for acquiring land in California. The stipulations related to its use have made it less appealing for those looking to buy real estate in the state.
Opportunity cost is defined as the loss incurred when one chooses one alternative over another.
In this scenario, the forgone option is full-time work along with other costs associated with that period when opting for schooling instead. Room and board expenses remain constant whether attending school or working full time, thus these are not factored in. Earnings from part-time work during school are deducted as they would have been earned during full-time employment.
Thus;
Opportunity cost = $20,000+$10,000+$1,000-$8,000 = $23,000
Opting for the lease is a more favorable choice. To illustrate, we examine the calculations for both options. First, we calculate the Net Present Value (NPV) for the Lease Option:
Year n Details CF ($) DF=1/(1.1)^n PV ($)
1 - Lease payment (30,000) 0.9091 (27,273)
2 - Lease payment (30,000) 0.8264 (24,793)
3 - Lease payment (30,000) 0.7513 (22,539)
4 - Lease payment (30,000) 0.6830 (20,490)
The NPV for the lease option equals (95,096).
For the Buy Option, we carry out the following calculations:
Year n Details CF ($) DF=1/(1.1)^n PV
0 Purchase cost (80,000) 1.0000 (80,000)
1 Maintenance costs (10,000) 0.9091 (9,091)
2 Maintenance costs (10,000) 0.8264 (8,264)
3 Maintenance costs (10,000) 0.7513 (7,513)
4 Maintenance costs (10,000) 0.6830 (6,830)
Residual value at end of year 4 20,000 0.6830 13,660
The NPV for the buy option results in (98,038).
To determine the equivalent annual annuity (EAA) for each option:
EAA = (r × NPV) / (1 - (1 + r)^-n)
where r is the discount rate per period and n shows the number of periods.
Calculating:
Lease option EAA = (0.1 × -95,096) / (1 - (1 + 0.1)^-4) = -30,000.
Buy option EAA = (0.1 × 98,038) / (1 - (1 + 0.1)^-4) = -30,928.
Since the lease option manifests a lower EAA of $30,000 compared to the buy option's $30,928, the lease is deemed the superior choice.
Answer:
Shirly is a good fit for careers in law, public safety, and security.
Explanation:
The professions in law, public safety, and security align closely with the characteristics noted in Shirly's evaluation, reflecting her qualities of justice, security awareness, and physical fitness to handle risky situations, all of which benefit the community she serves.
