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NEW QUESTION: 1
An administrator wishes to replace a legacy clinical software product as it has become a security risk. The legacy product generates $10,000 in revenue a month. The new software product has an initial cost of
$180,000 and a yearly maintenance of $2,000 after the first year. However, it will generate $15,000 in revenue per month and be more secure. How many years until there is a return on investment for this new package?
A. 0
B. 1
C. 2
D. 3
Answer: A
Explanation:
Explanation
Return on investment = Net profit / Investment
where:
Profit for the first year is $60 000, second year = $ 120 000 ; third year = $ 180 000 ; and fourth year = $
240 000
investment in first year = $ 180 000, by year 2 = $ 182 000; by year 3 = $ 184 000 ; and by year 4 = $ 186 000 Thus you will only get a return on the investment in 4 years' time.
References:
http://www.financeformulas.net/Return_on_Investment
NEW QUESTION: 2
Which Exadata feature uses Flash as a parallel write cache to Disk Controller Cache?
A. high performance SAS disks
B. Hybrid Columnar Compression
C. Smart Flash Log
D. Exadata DRAM
E. InfiniBand network cache
Answer: C
Explanation:
Reference:http://www.oracle.com/technetwork/database/availability/databaseawareflash2030367.pdf(slide 21)
NEW QUESTION: 3
Consider the following information for Company ABC:
Current Price of Stock $40.25
Expected dividend in 1 Year $1.10
Growth rate 9.2%
Beta 1.2
Risk Free Rate 4.5%
Expected Market Return 10%
Calculate this company's cost of retained earnings using the Discounted Cash Flow (DCF) method.
A. 13.70%
B. 13.30%
C. 11.93%
D. 12.0%
E. 9.20%
F. 11.04%
Answer: C
Explanation:
Explanation/Reference:
Explanation:
The DCF method for estimating the cost of retained earnings states: Cost of Retained Earnings = (Dividend for period 1 / Current Price) + Growth Rate. In this case the estimated Cost of Retained Earnings
= (1.1 / 40.25) + 9.2% = 2.73 + 9.2 = 11.93%