Answer:
The present value of the cash flow, discounted at a 5% annual rate, is $76,815.65.
Explanation:
First, we calculate the present value of a $15,000 annuity over 4 years:
C 15,000.00
Time 4
Rate 0.05
PV $53,189.2576
Next, we discount two additional years as a lump sum, corresponding to two years following the investment:
Maturity 53,189.26
Time 2.00
Rate 0.05000
PV 48,244.2245
Adding them results in the present value:
48,244.22 + 28,571.43 = 76,815.65
Answer:
export products with a greater labor-to-land ratio than those imported from Honduras
Explanation:
According to the factor proportions theory (also known as Heckscher-Ohlin model), nations tend to export goods that utilize their plentiful production factors. For instance, nations such as Japan, which have a high availability of labor and capital but limited land, typically manufacture and export industrial items that are labor- and capital-intensive. In contrast, countries like Argentina with ample labor and land resources tend to export agricultural goods.
Specifically, when comparing El Salvador to Honduras, El Salvador possesses a surplus of labor, meaning its exported products to Honduras will exhibit a greater labor-to-land ratio, attributed to the labor abundance.