Determining the appropriate discount rate

Assignment Help Other Subject
Reference no: EM132351074

Apple introduced iPhone XR last year. Now you have two options to buy the iPhone from Apple. The first option allows you to upgrade to a new unlocked iPhone every year with a monthly payment of $32.45. This option comes with an AppleCare+ (a damage replacement plan). The second option requires you to pay $649 in front with a resale value of $450 after one year and $300 after two years. In this case, pay $99 extra for the AppleCare+ that covers for two years. Note that AppleCare+ is not transferable to a new phone. If you do not care whether you can have a new phone every year or every two years, you have three choices to have an iPhone. Choice I: you can use the upgrade program; Choice II: you can pay in full in front and purchase the AppleCare+. The next year, you'll sell the old phone and buy a new one; Choice III: it is similar to Choice II, except that you will sell your old phone in two years and buy a new one. Assume that you will continue with the same choice going forward. The appropriate discount rate is 9% APR on a monthly basis.

Reference no: EM132351074

Questions Cloud

Total cost of the collar strategy : Which call and which put did you select? Pick the best collar. List the collar below and tell the total cost of the collar strategy
What would be the profit to the refiner : The refiner's long futures position will be exchanged for this physical supply. What would be the profit to the refiner?
Owner of a large portfolio of long-term bonds : Suppose you are the owner of a large portfolio of long-term bonds in the health care industry and you believe that in the next three years
What behavior-bias is present : 1) What behavior/bias is present? 2) Why is this behavior detrimental?
Determining the appropriate discount rate : Assume that you will continue with the same choice going forward. The appropriate discount rate is 9% APR on a monthly basis.
Calculate after-tax cash flow at disposal : Calculate After-Tax Cash Flow at disposal. Round the answer to two decimals.
Special purpose vehicle and a structured investment vehicle : Please help me answer this multiple choice question. One difference between a Special Purpose Vehicle (SPV) and a Structured Investment Vehicle (SIV)
There were not only economic exposures lately : There were not only economic exposures lately, but also some significant policy changes in recent months.
What is th enew market value of the company : Hickock, Inc., is proposing a rights offering. Presently there are 350,000 shares outstanding at $64 each. There will be 50,000 new shares offered at $58 each

Reviews

Write a Review

Other Subject Questions & Answers

  What are some examples of representative art

What are some examples of representative art that illustrate the idea that the subject/mind and the object/world/body are distinct?

  Increase the environmental lapse rate

Which of the following would increase the environmental lapse rate?

  Accepting your offer

Do you think Smith should have a remedy against Jones because he did not get the Rolls? (5m)

  Conflict theory-symbolic interactionism

Give an example of the conflict theory perspective on crime. Provide an example of Symbolic Interactionism as a theoretical perspective on education.

  How did the childhoods of the members of the beatles

How did the childhoods of the members of The Beatles influence their early music.

  Differentiate between legal and ethical issues

Differentiate between legal and ethical issues as they pertain to labor relations. Are there some ethical issues in labor relations that do not necessarily require legal remedies? Describe.

  Design a reasonable trajectory to asteroid

Orbital Mechanic Report Assignment: This project is to design a reasonable trajectory to asteroid 1998 EH56 with considerable fuel consumption

  Where does the organization want to go and why

Students will develop a set of priority strategic goals and identify the resources necessary to achieve the goals. Establishing strategic goals is a disciplined, organized way of describing your health care organization's strategic direction and h..

  What are journalists perfect duties

What are journalists' perfect duties? What is journalistic ethics? How good journalism can harm? What is the journalists' creed?

  What is the role of the community in ensuring accountability

What is the role of the community, state, and federal government in ensuring accountability? What is the possible impact of not making the identified changes?

  What major changes in political structures occured

HS150 - World Civilizations I - What major changes in political structures, and social and economic life, occurred during each of the following?

  Discuss one of the main criticisms of structuralism

Analyze the limitations and strengths of the method of studying consciousness in parts.discuss one of the main criticisms of structuralism.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd