Business, 06.05.2020 07:37 genyjoannerubiera

Suppose a worker with an annual discount rate of 10 percent currently resides in Pennsylvania and is deciding whether to remain there or to move to Illinois. There are three work periods left in the life cycle. If the worker remains in Pennsylvania, he will earn $20,000 per year in each of the three periods. If the worker moves to Illinois, he will earn $22,000 in each of the three periods. What is the highest cost of migration that a worker is willing to incur and still make the move?

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Answer from: Kana81

$4,973.70

Explanation:

Using ordinary annuity formula, we have

PV of Pennsylvania income = P × [{1 - [1 ÷ (1+r)]^n} ÷ r] …………. (1)

Where;

P = yearly income = $20,000

r = interest rate = 10% = 0.10

n = number of years = 3

Substitute the values into equation (1) to have:

PV of Pennsylvania income = $20,000 × [{1 - [1 ÷ (1+0.1)]^3} ÷ 0.1] = $49,737.04

PV of Illinois income = P × [{1 - [1 ÷ (1+r)]^n} ÷ r] (2)

Where;

P = yearly income = $22,000

r = interest rate = 10% = 0.10

n = number of years = 3

Substitute the values into equation (2) to have:

PV of Illinois income = $22,000 × [{1 - [1 ÷ (1+0.1)]^3} ÷ 0.1] = $54,710.74

Highest cost of migration = PV of Illinois income - PV of Pennsylvania income = $54,710.74 - $49,737.04 = $4,973.70

Answer from: Quest

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation:

Answer from: Quest

This app is rigge im si mad

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