Thanks to a Generous and Eccentric Donor, the School of Business

question 82

Multiple Choice

Thanks to a generous and eccentric donor, the school of business has 3 fax machines.The toner in each machine needs to be changed after about 5 hours of use.There is one unit secretary who is responsible for the fax machine maintenance.It takes him 15 minutes to replace the toner cartridge.What is the average number of fax machines in the system?

• A).0142 fax machine
• B).1563 fax machine
• C).0249 fax machine
• D).2749 fax machine

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Definitions:

Compounded Monthly

The process where interest earned on an investment is added to the principal each month, with future interest then earned on the new total.

Semi-Annually

Describes an event or action that occurs twice a year, typically every six months.

Present Values

The valuation in today's currency of future cash flows or a lump sum, factoring in a specific rate of return.

Discount Rate

This is the interest rate that's used to determine the current value of future cash flows in the analytical process of discounted cash flow.