The Following Investment Cash Flows Have Been Entered into Cells

question 4

Multiple Choice

The following investment cash flows have been entered into cells B5 through B9 of an EXCEL spreadsheet. B5 $(5,200 ) , B6 $2,100, B7 $1,300, B8 $1,800, B9 $1,200, where $5,200 is the cost of the investment and the following amounts are cash flows at the end of years one through four. The correct function for computing the yield on this investment is

• A) =irr(B6:B9)+B5.
• B) =rate(4,0,- 5200, 1200).
• C) =irr(B6:B9).
• D) =ytm(B5, B6:B9).

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Definitions:

Market Share

The portion of a market controlled by a particular company or product, often expressed as a percentage of total sales in that market.

Forward Buying

The practice of purchasing goods in advance of need, often in larger quantities, to take advantage of favorable pricing, secure inventory, or hedge against future price increases.

Market Growth

An increase in the demand for a particular product or service over time, often measured by changes in sales and market share.

Stealing Share

A competitive strategy aimed at gaining market share from competitors by attracting their customers, rather than expanding the overall market.