Question 1: Your Finance Textbook Sold 47,000 Copies In Its

Question 1your Finance Text Book Sold 47000 Copies In Its First Year

Your finance text book sold 47,000 copies in its first year. The publishing company expects the sales to grow at a rate of 18.0 percent for the next three years, and by 14.0 percent in the fourth year. Calculate the total number of copies that the publisher expects to sell in year 3 and 4.

If you solve this problem with algebra round intermediate calculations to 6 decimal places, in all cases round your final answers to the nearest whole number.

Paper For Above instruction

The growth trajectory of a textbook's sales provides valuable insight into future revenue projections for publishers and stakeholders. Given the initial sales of 47,000 copies and specified growth rates, the task involves calculating the projected sales for the third and fourth years to aid in strategic planning and financial forecasting.

To perform these calculations, we start with the initial sales base and apply the compound growth formula for each subsequent year. Specifically, the sales in year n (S_n) can be derived from the initial sales (S_0) using the formula:

S_n = S_0 × (1 + growth rate)^n

Using this, sales after year 1 are:

S_1 = 47,000 × (1 + 0.18) = 47,000 × 1.18 = 55,460 copies

Similarly, sales after year 2 are:

S_2 = 47,000 × (1.18)^2 = 47,000 × 1.3924 ≈ 65,442.8 copies

Sales after year 3 are:

S_3 = 47,000 × (1.18)^3 = 47,000 × 1.643992 ≈ 77,716 copies

Finally, sales after year 4 are:

S_4 = 47,000 × (1.18)^4 = 47,000 × 1.9383 ≈ 91,946 copies

Specifically for the task, the total expected sales in year 3 are approximately 77,716 copies, and in year 4, approximately 91,946 copies, both rounded to the nearest whole number.

References

  • Damodaran, A. (2012). Investment Valuation: Tools and Techniques for Determining the Value of Any Asset. Wiley Finance.
  • Ross, S. A., Westerfield, R., & Jaffe, J. (2013). Corporate Finance (10th ed.). McGraw-Hill Education.
  • Brigham, E. F., & Houston, J. F. (2019). Fundamentals of Financial Management. Cengage Learning.
  • Brealey, R. A., Myers, S. C., & Allen, F. (2020). Principles of Corporate Finance. McGraw-Hill Education.
  • Fabozzi, F. J. (2016). Bond Markets, Analysis and Strategies. Pearson Education.
  • Higgins, R. C. (2012). Analysis for Financial Management. McGraw-Hill Education.
  • van Horne, J. C., & Wachowicz, J. M. (2008). Fundamentals of Financial Management. Pearson Education.
  • Ross, S. A., & Westerfield, R. (2017). Fundamentals of Corporate Finance. McGraw-Hill Education.
  • Ehrhardt, M. C., & Brigham, E. F. (2021). Corporate Finance: A Focused Approach. Cengage Learning.
  • Damodaran, A. (2015). Applied Corporate Finance. Wiley Finance.

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