A permanent flood-control dam is expected to have an initial cost of $2.8 million and an annual M&O cost of $20,000. In addition, minor reconstruction will be required every 5 years at a cost of $200,000. As a result of the dam, flood damage will be reduced by an average of $310,000 per year. Using an interest rate of 6% per year, the conventional B/C ratio will be closest to: (a) 0.46 (b) 1.02 (c) 1.40 (d) 1.96

Q: A proposed steel bridge has an indefinite life. The initial cost of the bridge is $3,750,000, and…

A: Given information is: A proposed steel bridge has an indefinite life. The initial cost of the bridge…

Q: Conventional Corporation is evaluating a capital budgeting project that will generate $600,000 per…

A: YEAR CASH FLOW      0  $                      (3,600,000.00) 1  $…

Q: What will be the equivalent uniform annual amount that will be deposited in a bank for 15 years that…

A: Time Period 15 Initial Cost  P20,00,000.00 Additional Cost at the end evry 5th year…

Q: You are considering a project with an initial cost of $7,800. What is the payback period for this…

A: Calculation of Payback Period:Using Excel Spreadsheet:

Q: Calculate the IRR for the project

A: Internal rate of return(IRR) is a method of capital budgeting which considers the time value of…

Q: The company will have to make Capital Investments, Working Capital investments, and generate Cash…

A: Formulas:

Q: A flood control project with a life of 14 years will require an investment of $57.000 and annual…

A: Benefit to cost ratio: It is ratio of present value of the benefits to present value of costs.

Q: A power station in Al-Salmiya is expected to require an initial investment of 3.5 million KWD and…

A: Conventional benefit-to-cost ratio (B-C) =Benefits-DisbenefitsCosts=B-DC Given Initial investment…

Q: EABL is considering an investment that will cost $80,000 and have a useful life of 4 years. During…

A: The payback period is the time taken by an investment to reach its Break-Even Point or in other…

Q: The construction of a bypass road needs a capital investment of $200,000 and $10,000 would be…

A: Capital Investment = $200,000 Maintenance = $10,000 Annual Benefits = $60,000 MARR = 12%

Q: A Water Treatment Company is considering the installation of new magnetic flow mieters in one of its…

A: Since you have asked a question with multiple parts, we will solve the first 3 parts as per policy.…

Q: A permanent flood control dam is expected to have an initial cost of $2.8 million and an annual…

A: Conventional B/C ratio can be calculated by using the following formula: B/C ratio = benefit -…

Q: A power station in Al-Salmiya is expected to require an initial investment of 3.5 million KWD and…

A: Benefit to cost ratio means where present value of cash inflow is divided with present value of cash…

Q: Ace Investment Company is considering the purchase of the Apartment Arms project. Next year’s NOI…

A: Given: Cash flows: $2000,000 Growth rate: 4% Required rate of return :13% Formulas for the above…

Q: 16

A: Calculation of the NPV (net present value) is shown below: Hence, the last option is correct.

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A: Question is based on NPV concept of capital budgeting. Which is used to evaluate the long term…

Q: An engineering project analyst is contemplating a 3-year project which will require an initial…

A:

Q: A certain government funded city flood control system has an initial investment cost of $500,000.…

A: Initial Investment = $500,000 Operating Cost every year = $10,000 Every 5 years the repair and…

Q: The construction cost of the bypass is $20 million, and $500,000 would be required each year for…

A: A benefit-cost ratio is an indicator, used in cost benefit analysis, that attempts to summarize the…

Q: A five-year project is expected to generate annual revenues of $159,000, variable costs of $72,500,…

A: To find the annual operating cash flow, we will follow these steps: Sales…

Q: A project is expected to create operating cash flows of $30,000 a year for three years. The initial…

A: The question is based on the concept of Financial Management. Net present value is the difference…

Q: Jasmine Manufacturing is considering a project that will require an initial investment of $51,900…

A: Year Cash flow 0 -51900 1 9700 2 9700 3 9700 4 8400 5 8400 6 1500 7 1500 8 1500…

Q: payback period for this project?

A: Payback period is the number of years required to fully recover the initial investment.

Q: The construction of a bypass road needs a capital investment of $200,000 and $10,000 would be…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: BNN Corporation is currently evaluating a project that requires an initial investment of $1,000,000…

A: Hurdle Rate = 5% Initial Investment = 1,000,000 Cash Flows: Year Cash Flow 0 -1,000,000 1…

Q: A SMALL FLOOD CONTROL PROJECT HAS A CAPITAL INVESTMENT COST OF $300,000 AND AN ANNUAL MAINTENANCE…

A: Investment cost = $ 300,000 Annual maintenance cost = $ 80,000 Annual interest rate = 10% Period = 5…

Q: A water Reservoir will have a first cost of Php 10,000,000,000, an annual maintenance cost of…

A: First cost (C) = Php 10,000,000,000 Annual maintenance cost (A) = Php 35,000,000 Reconstruction cost…

Q: Giant Equipment Ltd. is considering two projects to invest next year. Both projects have the same…

A: In order to know which project to be selected one has to find the Net present value.

Q: Stone Inc. is evaluating a project with an initial cost of $9,500. Cash inflows are expected to be…

A: In the given question we need to calculate the net present value of the project.

Q: Niagra Falls Power and Light is considering a project that will produce annual cash flows of…

A: YEAR CASH FLOW       0  $        (113,500.00) 1  $            37,500.00 2  $…

Q: The construction of a bypass road needs a capital investment of $200,000 and $10,000 would be…

A: The following information is given in the question Particulars Amount Investment   2,00,000…

Q: A flood control project with a life of 16 years will require an investment of $60,000 and annual…

A: Capital budgeting decisions- It refers to the process of analyzing and deciding which long-term…

Q: A 7-year project is expected to provide annual sales of $221,000 with costs of $97,500. The…

A: GIVEN, WORST SCENARIO accuracy = +/-15% annual sale= $221,000 x (1-0.15)= $187,850 annual cost =…

Q: A project costing $6,200 initially should produce cash inflows of $2,860 a year for three years. The…

A: Net present value is the technique used in capital budgeting to evaluate the acceptability of the…

Q: Jasmine Manufacturing is considering a project that will require an initial investment of $49,400…

A: The payback period is the estimated period in which the investment is expected to be returned fully.…

Q: Giant Equipment Ltd. is considering two projects to invest next year. Both projects have the same…

A: Introduction: For the selection of the projects, we need to calculate the Present Value for both…

Q: You are analyzing a project with 5-year life. The project requires a capital investment of $74,000…

A: Initial Capital  $      74,000.00 Annual Revenue  $      44,400.00 Salvage value  $…

Q: A project has an initial cost of $35,000 and produces cash flows of $20,000, $15,000, $10,000, and…

A: Net Present Value is the difference between the current value of cash inflow and cash outflow for a…

Q: Acme, Inc. is considering a four-year project that has an initial outlay or cost of $100,000. The…

A: Unrecovered investment at start of 4th year= Initial cost – Cumulative cash inflow at the end of 3rd…

Q: You are considering a project with an initial cost of $7,500. What is the payback period for this…

A: Given: Year Cash Flows 0 -7500 1 1100 2 1640 3 3800 4 4500

Q: Jasmine Manufacturing is considering a project that will require an initial investment of $53,700…

A: Ans. The payback period refers to the amount of time taken to recover the cost of an investment.

Risk Management Techniques

Risk management is the procedure of recognizing, analyzing, monitoring, and preventing the risks and threatening factors of investments and business. Risks can arise from various factors including internal controls, market changes, natural disasters, and failure in productions. Risk management techniques enable entities to control and minimize the risks as well as the threatening factors of the business and it also helps to improve the business.