.The monthly consumption of electrical energy in Isra University 50000JD. The University installed a solar PV system with a cost of 500000 JD. Calculate the payback
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1.The monthly consumption of electrical energy in Isra University 50000JD. The University installed a solar PV system with a cost of 500000 JD.
Calculate the payback period of capital for this investment.
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- Mason, Inc., is considering the purchase of a patent that has a cost of $85000 and an estimated revenue producing lite of 4 years. Mason has a required rate of return that is 12% and a cost of capital of 11%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?Your company is planning to purchase a new log splitter for is lawn and garden business. The new splitter has an initial investment of $180,000. It is expected to generate $25,000 of annual cash flows, provide incremental cash revenues of $150,000, and incur incremental cash expenses of $100,000 annually. What is the payback period and accounting rate of return (ARR)?Manzer Enterprises is considering two independent investments: A new automated materials handling system that costs 900,000 and will produce net cash inflows of 300,000 at the end of each year for the next four years. A computer-aided manufacturing system that costs 775,000 and will produce labor savings of 400,000 and 500,000 at the end of the first year and second year, respectively. Manzer has a cost of capital of 8 percent. Required: 1. Calculate the IRR for the first investment and determine if it is acceptable or not. 2. Calculate the IRR of the second investment and comment on its acceptability. Use 12 percent as the first guess. 3. What if the cash flows for the first investment are 250,000 instead of 300,000?
- E2 There are 10 solar panels (each of 2MW), and the following information is about them. The solar panels are expected to produce 2250 full load hours per year, the investment cost is 172 million dollars, and it is expected that the maintenance cost is 80 $/MWh. The production from the solar panels is expected to be 0.38 $/kWh. The lifetime of the solar panels is 20 years, with a discount rate of 4%. 1) Calculate NPV for the investment 2) Calculate the IRRAssume everything is given in n=0, CONSTANT dollars unless otherwise stated: MTA Textile INC. is considering to invest on a computer-controlled fabric cutting machine. The machine’s purchasing price is $150,000. The part of the initial cost of this investment will be paid using a $50,000 loan. The loan will be repaid in yearly installment for four years at 12%. This project requires a working capital investment of $15,000 at year 0. This investment on working capital will be fully recovered after the project is terminated. The salvage value of this investment at the end of fourth years is expected to be $40,000. This machine will generate annual revenues of $55,000, but have annual operating costs of $3,000. The equipment has a 45% declining balance rate for CCA calculations. The marginal income tax rate for the firm is given as 35%. A general inflation rate is expected to be 5%. However, the firm also expects 8% annual increase in revenue and working capital and a 4% annual increase…Assume everything is given in n=0, CONSTANT dollars unless otherwise stated: MTA Textile INC. is considering to invest on a computer-controlled fabric cutting machine. The machine’s purchasing price is $150,000. The part of the initial cost of this investment will be paid using a $50,000 loan. The loan will be repaid in yearly installment for four years at 12%. This project requires a working capital investment of $15,000 at year 0. This investment on working capital will be fully recovered after the project is terminated. The salvage value of this investment at the end of fourth years is expected to be $40,000. This machine will generate annual revenues of $55,000, but have annual operating costs of $3,000. The equipment has a 45% declining balance rate for CCA calculations. The marginal income tax rate for the firm is given as 35%. A general inflation rate is expected to be 5%. However, the firm also expects 8% annual increase in revenue and working capital and a 4% annual increase…
- Assume everything is given in n=0, CONSTANT dollars unless otherwise stated: MTA Textile INC. is considering to invest on a computer-controlled fabric cutting machine. The machine’s purchasing price is $150,000. The part of the initial cost of this investment will be paid using a $50,000 loan. The loan will be repaid in yearly installment for four years at 12%. This project requires a working capital investment of $15,000 at year 0. This investment on working capital will be fully recovered after the project is terminated. The salvage value of this investment at the end of fourth years is expected to be $40,000. This machine will generate annual revenues of $55,000, but have annual operating costs of $3,000. The equipment has a 45% declining balance rate for CCA calculations. The marginal income tax rate for the firm is given as 35%. A general inflation rate is expected to be 5%. However, the firm also expects 8% annual increase in revenue and working capital and a 4% annual increase…An entrepreneur wants to establish a facility by spending 250 USD in the first year, 300 USD in the second year, and 350 USD in the third year. Since the capital cost of this project is 32%, what is the investment amountYou are considering the following investment activity. The facts are the following: Required investment 300,000.00 Discount Rate 9% Life of project 7.00 Years Net income for the project Sales 140,000.00 Expenses Material 25,000.00 Labor 35,000.00 235000 Overhead 15,000.00 Total Expenses 75,000.00 Net Income 65,000.00 What is the NPV of this investment? 2,714,193.00 What is the IRR of this investment? 11646% Would you fund this project? yes Show your work below Year 0 -300,000.00 1 65,000.00 2 65,000.00 3 65,000.00 4 65,000.00 5 65,000.00 6 65,000.00 7 65,000.00
- 2. Skywards Inc., an airline caterer, is purchasing refrigerated trucks at a total cost of $3.25 million. After-tax net income from this investment is expected to be $750,000 for the next five years. Annual depreciation expense was $650,000. The company’s cost of capital is 15 percent. Compute the discounted payback for this project? Compute the NPV for this project Compute the IRR for this project1. Atty. Munar invested P280, 000 which will be used in a project that will produce a uniform annual revenue of P180,000 for 5 years and then have a salvage value of 15% of the investment. Out-of-pocket costs for operation and maintenance will be P80,000 per year. Taxes and insurance will 3% of the first cost per year. Atty Munar expects capital to earn not less than 30% before income taxes. Is this a desirable investment? What is the payback period of the investment?(a) Calculate using Rate of Return Method.(b) Calculate using Present Worth Method.(c) Calculate using Future Worth Method.(d) Calculate using Payback Method.olar Winds Inc. has a solar plant project that has a initial investment of $250,000, The estimated life of the project is 5 years. The market rate of return is 9%.Year Annual Profits1 50,0002 50,0003 75,0004 75,0005 80,000 What is the NPV of this project?
