Question

Please give me solution and pick from multiple choice

Metal Ltd is looking at producing power boards. The company is considering alternative production methods. The costs (in million) and lives associated with each are:

Model	Year 0	Year 1	Year 2	Year 3	Year 4	Year 5
Model 1	-$90	-$2	-$2	-$2
Model 2	-$80	-$8	-$8	-$8	-$8	-$8

Assume the discount rate is 10%, which model should Metal buy?

	a.	Metal Ltd should choose Model 2 as its annual equivalent cost is lower.
	b.	Metal Ltd should choose Model 1 as its annual equivalent cost is higher.
	c.	Metal Ltd should choose Model 2 as its annual equivalent cost is higher.
	d.	Metal Ltd should choose Model 1 as its annual equivalent cost is lower.

Which of the following statement is not true?

	a.	Public companies may be listed on a stock exchange, which facilitates trading in the company’s shares.
	b.	The shareholders of most companies have limited liability.
	c.	Based on the IRR rule, an investment is acceptable if the IRR exceeds zero. It should be rejected otherwise.
	d.	Partnerships are not separate legal entities and the partners are therefore personally liable for obligations (including debts) entered into by the partnership.

Starting with her next salary payment (next month), Kathy intends to save $200 each month. If the interest rate is 1% per month, how much will Kathy have saved after 12 months (12 deposits altogether over 12 months)?

Fill in the blank with the correct answer, rounded to 2 decimal places.

12 months later (in month 12), Kathy would have _________ in the bank account.

Answer 1