A Company Is Considering an Investment That Will Return $22,000 $\bold{\text{(Use appropriate factor(s)from the tables provided.)}}$

question 80

Multiple Choice

A company is considering an investment that will return $22,000 semiannually at the end of each semiannual period for 4 years.If the company requires an annual return of 10%,what is the maximum amount it is willing to pay for this investment? (PV of $1,FV of $1,PVA of $1,and FVA of $1) $\bold{\text{(Use appropriate factor(s) from the tables provided.) }}$

• A)Not more than $69,738
• B)Not more than $139,476
• C)Not more than $88,000
• D)Not more than $142,190
• E)Not more than $176,000

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Definitions:

Prices

The amount of money required to purchase goods or services, indicating the value that consumers are willing to pay and sellers are willing to accept.

Industry

A sector of the economy that includes all businesses involved in the production or processing of goods, provision of services, or related activities.

Market System

In this economic structure, supply and demand forces directly influence decisions around investment, production capacity, and distribution methods, with the price points of goods and services being freely determined in a competitive price system.

Expanding Industry

An industry or sector experiencing significant growth in terms of output, sales, or number of participants.