"Flo is considering three mutually exclusive options for the additional space she plans to add to her specialty women's store. The cost of the expansion will be $148,000. She can use this additional space to add children’s clothing, an exclusive gifts department, or a home décor section. She estimates the present value of the cash inflows from these projects are $121,000 for children’s clothing, $178,000 for exclusive gifts, and $145,000 for decorator items. Which option(s), if any, should she accept?"

a. Children’s clothing only
b. Exclusive gifts only
c. Exclusive gifts and decorator items only
d. All three options
e. None of these options

Question

13-05-2020
Business

contestada

"Flo is considering three mutually exclusive options for the additional space she plans to add to her specialty women's store. The cost of the expansion will be $148,000. She can use this additional space to add children’s clothing, an exclusive gifts department, or a home décor section. She estimates the present value of the cash inflows from these projects are $121,000 for children’s clothing, $178,000 for exclusive gifts, and $145,000 for decorator items. Which option(s), if any, should she accept?"

a. Children’s clothing only
b. Exclusive gifts only
c. Exclusive gifts and decorator items only
d. All three options
e. None of these options

Respuesta :

Otras preguntas

Welcome to this IE. You may navigate to any page you've seen already using the IE Outline tab on the right. A particle beam is made up of many protons each with

how can you say that joule and Newton are derived units

Solve this question for 5 points

Here the math question i need help on

In a test containing 10 questions, (+5) marks are awarded for every correct answer, (-1) mark for every incorrect answer and 0 for not attempting the questions.

The equation of the line that goes through the point (−10,8) and (−3,-4) can be written in the form y=mx+b where m is: and where b is:

1. A 5 cm3 balloon is filled by a gas at a pressure of 1 x 105 Pa . When the balloon is filled by 20 cm3 of the gas, what is the new pressure of the gas? A 1.0

You've learned a lot about wellness and want to share it with others. Which of the following is the best way to assist others in improving their own health, and

What is the value of Z? Z =2^3

Local marketing is an effective tool used by marketers to reach intended market segments. Groupon has capitalized on this concept by tailoring brands and market

Cetacea Cetacea · Answer 1 · 2020-05-13T08:34:09+02:00

Answer: Option(b) is the correct option.

Explanation:

According to the question,we are provided with investment value which is $148,000.

Therefore, Net present value (NPV)of Children Clothing will be calculated as :-

$121,000 - $148,000 = - $27,000

Thus, a negative value of NPV of children clothing is obtained which is not an acceptable value option.

Now ,Net present value(NPV) of Exclusive gift is as follows:-

$178,000 - $148,000= $30,000

As the obtained NPV value for exclusive gift option is $30,000 which is a positive value, it can be accepted

Now, calculation of NPV of decorator items is as follows:-

$145,000 - $148,000= - $3,000

Net present value of decorator items is obtained as -$3,000 which is a negative value.Thus, it is not acceptable.

Therefore, the correct option is option(b) because it as positive value of NPV and decorator items and children clothing as negative NPV value which makes them unacceptable .