Suppose That You Are Considering an Investment That Will Pay

question 32

Multiple Choice

Suppose that you are considering an investment that will pay you $4,000 per year for the next five years.The appropriate rate of interest is 5%.You want to know the present value of the cash flows from this investment.To solve this problem in Microsoft Excel,you would use which of the following Excel formulas?

• A) =PV(.05,5,4000,0,0)
• B) =PV(.05,5,4000,0,1)
• C) =PV(5,.05,4000,0)
• D) =PV(5,5,4000,0)

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Definitions:

Increasing Responsiveness

The process of enhancing a company's ability to respond quickly and effectively to customer demands, market changes, or manufacturing needs.

Implied Uncertainty

The degree of uncertainty inferred from a situation or model, often without explicit quantification.

Strategic Fit

The degree to which an organization is matching its resources and capabilities with the opportunities in the external environment.

Functional Strategies

Specific, smaller-scale plans designed to achieve objectives within a company's individual departments or functions, such as marketing or finance.