Concept explainers
a)
To determine: The present value profit or loss of the deal.
Introduction:
Present value (PV):
It is the value that is in present form of money in contrast to some future amount. This is achieved when it is invested in compound interest.
The NPV is the measurement of profit that is calculated by subtracting the present values of
b)
To determine: The special deal should be made or not made.
Introduction:
Present value (PV):
It is the value that is in present form of money in contrast to some future amount. This is achieved when it is invested in compound interest.
Net present value (NPV):
The NPV is the measurement of profit that is calculated by subtracting the present values of cash outflows and cash inflows. The NPV is used as a tool to measure the profitability of investing in a project.
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EP PRIN.OF OPERATIONS MGMT.-MYOMLAB
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- Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,