Lora Corporation Will Receive $10,000 a Year at the End

question 51

Multiple Choice

Lora Corporation will receive $10,000 a year at the end of each of the next five years.Using a discount rate of 14%,the present value of the receipts can be stated as ________.

• A) PV = $10,000 (Ordinary Annuity FV factor, i = 14%, n = 5)
• B) PV = $10,000 (PV factor, i = 14%, n = 5)
• C) PV = $10,000 (Ordinary Annuity PV factor, i = 14%, n = 5)
• D) PV = $10,000 (FV factor, i = 14%, n = 5)

---

Definitions:

Quantity Axis

A graphical representation element used in economics to indicate quantities, such as quantities of goods produced or sold.

Marginal Revenue

The extra revenue earned from the sale of an additional unit of a product or service.

Maximize Profits

The process by which a firm adjusts its production and pricing strategies to earn the highest possible profit.

Economic Profits

Profits calculated by subtracting both the explicit and implicit costs of production from total revenues.