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Author Question: Options have positive value if the expected cash flow from making the investment is more than the ... (Read 93 times)

deesands

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Options have positive value if the expected cash flow from making the investment is more than the value of maintaining the option.
 
  Indicate whether the statement is true or false

Question 2

Fernando plans to sell hot coffee, cider and tea from a sidewalk cart near Wall Street in New York City. Each month he expects to sell 20,000 of product to 4,000 customers.
 
  He spent 4,000 on buying his beverage and supplies in bulk for the first month. The rental deposit on the cart was 4,000 and Fernando spent 500 to customize it. He bought a laptop, printer and software for 1,000 and paid a total of 1,000 for licenses. He has 500 in petty case for start up. His monthly costs are: Utilities = 500, Salary = 4,000, Advertising = 0, Insurance = 500, Interest = 0, Rent (cart) = 2,000, Depreciation = 0. Calculate Fernando's start-up costs without a reserve.
  A) 18,000
  B) 14,000
  C) 12,500
  D) 11,000


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sierrahalpin

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deesands

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Reply 2 on: Jul 6, 2018
Excellent


cassie_ragen

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

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