Under TANF, there is a lifetime eligibility cap of five years, ...

[asan beg]

Under TANF, there is a lifetime eligibility cap of five years, with some loopholes.
 
  Indicate whether the statement is true or false

Question 2

Nancy is considering forming a 5 year business partnership with Claudia. Nancy believes her portion of the partnership will generate the following profits:
 
  Year Profits Present Value
  1 2,000
  2 4,000
  3 12,000
  4 15,000
  5 18,000
 
  Nancy's appropriate discount rate is 6. To join the partnership, Nancy needs to invest 30,000. Does the partnership offer a rate of return in excess of 6?

[Ptupou85]

Answer to Question 1

T

Answer to Question 2

As the table below indicates, the present value of the partnership is in excess of the 30,000 investment. This implies the partnership offers a rate of return greater than 6. In this case, Nancy should join the partnership.

Year Profits Present Value
1 2,000 1,886.79
2 4,000 3,559.99
3 12,000 10,075.43
4 15,000 11,881.41
5 18,000 13,450.65
TOTAL 40,854.27

[asan beg]

TYSM

[marict]

Excellent