Expect to earn these after-tax cash flows

Assignment Help Financial Management

Reference no: EM131458565

You can buy a business for $40,000. If you buy it, you can expect to earn these after-tax cash flows during Years 1 through 3: Year 1 = $5,000, Year 2 = $6,000, and Year 3 = $7,000. You can also expect to be able to sell the business for $20,000 at the end of Year 4. What is the expected annual rate of return on this investment?

Reference no: EM131458565

Questions Cloud

What is calculated interest rate of the arm : The margin on the loan is 5.4% and the rate cap is 6.25% over the life of the loan. If the current index rate is 7%, what is calculated interest rate of the ARM

Explain the supply chain of the new division of business : Analyze and explain the supply chain of the new division of the existing business. Share your plans to develop and leverage core competencies.

Key goal of the aftermarket period : Which one of the following is a key goal of the aftermarket period?

Define consumer behavior and describe marketing decisions : Define consumer behavior, and describe the role it plays in marketing decisions. Consumer behavior refers to the buyer behavior of individual consumers.

Expect to earn these after-tax cash flows : You can buy a business for $40,000. If you buy it, you can expect to earn these after-tax cash flows during Years 1 through 3: Year 1 = $5,000, Year 2 = $6,000,

Describe the interpersonal determinants of consumer behavior : Describe the interpersonal determinants of consumer behavior: cultural, social, and family influences. Cultural infl uences, such as the general work ethic.

How much will Audrey's balloon payment be in eight years : Audrey Sanborn has just arranged to purchase a $570,000 vacation home. How much will Audrey's balloon payment be in eight years?

Explain the personal determinants of consumer behavior : Explain each of the personal determinants of consumer behavior: needs and motives, perceptions, attitudes, learning, and self-concept theory.

What is the current rate of jims bonds in light of increase : what is the current rate of Jims bonds in light of the increase?

User Account

All Pages