Question

Twenty five years from today, you would like to give your child $100,000 for college education. How much money must you set aside today for this purpose if you can earn 4.2 percent on your investments?

Multiple Choice

• $28,672.18

• $35,752.55

• $31,688.46

• $22,227.32

• $26,633.12

Anothony-Towns' Instruments is analyzing a proposed project. The company expects to sell 1,500 units, ±3 percent. The expected variable cost per unit is $210 and the expected fixed costs are $428,000. Cost estimates are considered accurate within a ±2 percent range. The depreciation expense is $64,000. The sales price is estimated at $627 per unit, ±3 percent. What is the sales revenue under the worst-case scenario?

Multiple Choice

• $908,421.88

• $894,039.30

• $884,916.45

• $940,500.00

• $922,562.60

Answer 1

>>>>>

Future Value = $100,000

n = 25 years

r = interest rate = 4.2%

Amount to be invested today = Future Value / (1+r)^n

= $100,000 / (1+4.2%)^25

= $100,000 / 2.79700327

= $35,752.5503

Therefore, ampount to be invested today is $35,752.55

>>>>
Sales Units = 1,500 * (1-3%) = 1,455

Sale Price Per unit = $627 * (1-3%) = $608.19

Sales revenue under the worst case scenario = Sales Units * Sales price per unit

= 1,455 * $608.19

= $884,916.45

Therefore, sales revenue under worst case scenario is $884,916.45