Finance Answers

A student is considering opening a business selling ice cream next summer. The student views this as an alternative to taking summer employment with a local firm where he would earn £4,000 during the 3-month summer period. It would cost £2,000 to obtain a license to operate their stand, £1,200 per month to rent the stand with the necessary equipment and £150 per month for insurance. Petrol costs are estimated at £12 per day and are not affected by sales. The ice cream ingredients can be bought for £5.60 per kilo and cones cost £1.80 per dozen. The ice cream cones contain 100 grams of ice cream and would sell for £1.50 each.

d) Chocolate flakes can be bought at £5 for a box of 20, and the ice creams with flakes are sold for £2.20. If 40% of the customers buy these, calculate the effect of this on the output necessary to make normal profit.
e) If the student can sell 200 ice creams a day, 40% with flakes, estimate the economic profit he would make. Advise him whether he should enter the business.

Consider a community consisting of 20 households who depend on a common well for its supply of water. Clean-up and chemical treatment is required to ensure safety of water from the well. The marginal benefits to each household from clean-up and treatment is given by the equation,
MBx=100-4X
If the marginal clean-up and treatment cost is 100 + 20X where X represents the number of clean-ups and chemical treatment per year,
1. Determine the social optimal number of clean-ups and chemical treatment per year.
2. Compute the net social welfare benefit to each household if the households share the cost of clean-ups and treatment
3. Compute the total social welfare benefit to each household if half of the households pay half the cost of clean-ups and treatment
4. Compute the amount of free riding from the two groups in 3 above

three investors need your advisory: investor X is an old man wants to use his pension to safe guard his remaining life; investor Y is matured jobber who wants to convert his regular savings into a major source of income; investor Z is a lady with some children needs to put a part of her income for future returns through which she can finance her children education and marriages (based on financial instruments/institutions and financial markets what three plan you will offer to each with logical justification

three investors need your advisory: investor X is an old man wants to use his pension to safe guard his remaining life; investor Y is matured jobber who wants to convert his regular savings into a major source of income; investor Z is a lady with some children needs to put a part of her income for future returns through which she can finance her children education and marriages (based on financial instruments/institutions and financial markets what three plan you will offer to each with logical justification)

From a financial and economic point of view, was the GM bail out a good option and why?

suppose you make an annual contribution of $5000 to your savings account at the end of each year for five years if your savings account earn 6% interest annualy how much can be withdrawn at the end of five years?

what is PPP and there are two types: Absolute and Relative explain

A loan of $8 000 is to be amortized with equal monthly payments over 2 years at j12 = 15%. Find the outstanding balance after 7 months and split the eighth payment into interest and principal portions.

In this activity you will determine if the person in each of the 10 following scenarios has to file or should file a tax return. Be prepared to explain your reasoning!

Why do many companies use a positive number instead of zero for the NPV rule?