A Computer You Are Considering for Your Business Would Add

question 14

Essay

A computer you are considering for your business would add $4,000 per year to your profit. It would cost $400 a year to buy a complete maintenance contract so that you would never have repair and upkeep expense. The obsolescence depreciation is 25% a year. The going market interest rate is 5%. Assume all costs and revenue occur at the end of the year. If the going interest rate went up to 10%, how much would you be willing to pay for the machine?

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Definitions:

Positive Reinforcers

In behavioral psychology, stimuli that, when presented following a behavior, increase the likelihood of that behavior being repeated.

Negative Reinforcers

In behavioral psychology, an unpleasant stimulus whose removal leads to an increase in the likelihood that a preceding behavior will be repeated in the future.

Negative Reinforcement

A type of operant conditioning that strengthens a behavior by removing an unpleasant stimulus when the behavior occurs.

Tertiary Reinforcement

A form of reinforcement where a stimulus gains its reinforcing power through association with a secondary reinforcer, rather than satisfying a basic biological need.