Calculate the present worth from the given project summary. Capital Costs = $37,000; Revenue = $15,000/year; Operation and Maintenance Costs = $7,100/year; Salvage Value = $17.000; Project Lifetime = 3 years: Effective Interest Rate = 0.03. %3D %3D %3D
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- Present worth is an equivalence method of analysis in which a project's cash flows are discounted to a single present value. True or false?Give typing answer with explanation and conclusion A small company purchased now for $120,000 will lose $300 each year for the first four years. An additional $600 in the company in the fourth year will result in a profit of $9500 each year from the fifth through the twelfth year. At the end of 12 years, the company can be sold for $135,000. a) Draw the cash flow diagram b) Determine the IRR for this project. c) Calculate the FW if MARR is 5%. d) Calculate the ERR when ε = 7%.You bought the latest IPhone 13 for your online selling business for Php 83,000.00. With this, your online income has increased by Php 1,000.00 anually. After 7 years, your Iphone 13 can be sold at Php 13,000.00. You have set your personal MARR to be at 8%. Was your purchase of the Iphone 13 economically viable? Show complete solution using Present Worth Method, Annual Worth Method, and Future Worth Method and with cashflow diagram.
- Charlie has a project for which he had determined a present worth of $56,620. He now has to calculate the IRR for the project, but unfortunately he has lost complete information about the cash flows. He knows only that the project has a five-year service life and a first cost of $190,000, that a set of equal cash flows occurred at the end of each year, and that the MARR used was 10 percent. What is the IRR for this project?The future worth of a project with initial cost P, positive annual cash flows of A, salvage value S, and interest rate of i over a life of n years can be calculated using which statement? (a) FW = −P(F/P, i%, n) + A(F/A, i%, n) + S(F/P, i%, n) (b) FW = P(F/P, i%, n) + A(F/A, i%, n) + S (c) FW = −P(P/F, i%, n) + A(F/A, i%, n) − A[(P/A, i%, n) + S (d) FW = −P(F/P, i%, n) + A(F/A, i%, n) + S?(perpetuities) A man planned of building a house. The cost of construction is Php 550,000, while annual maintenance cost is estimated at Php 10,000 . If the interest rate is 7.23%, what is the capitalized cost of the house? Round your answer to 2 decimal places
- Solo Corporation is evaluating a project with the following cash flows: Year 0,1, 2, 3, 4, 5 Cash Flow $ -29,600; 11,800; 14,500 ; 16,400; 13,500 and -10,000. The company uses an interest rate of 10 percent on all of its projects. Calculate the MIRR of the project using all three methods. a. MIRR using the discounting approach. b. MIRR using the reinvestment approach. c. MIRR using the combination approach.Using exactly the same information from Problem No. 1 above, calculate the Annual Worth of Project Y at 8% per year interest rate. You can see the data in picture one, answer the problem in the second picture.You are planning to purchase equipment that costs Rs. 30,000 and is expected to last 12 years with a Rs. 3,000 salvage value. The annual operating expenses are expected to be Rs. 9,000 for the first 4 years but owing to decreased use, the operating costs will decrease by Rs. 400 per year for the next 8 years. MARR is 20%. Approximately what will the present worth of this investment be? Select the value closest to your answer a) Rs. 61,000 b) Rs. 67,000 c) Rs. 72,000 d) Rs. 75,000
- using Microsoft excel create an investment cash-flow diagram that will have a present worth of zero using MARR=12% the study period needs to be exactly 9 years and each year should have at least one unique cash flow that is different from the cash-flows over the other years your answer should contain a table showing the cash-flows for each year and a graphical representation of the cash-flowsAn expenditure of $20,000 is made to modify a material-handling system in a small job shop. This modification will result in first-year savings of $2,000, a second-year savings of $4,000, and a savings of $5,000 per year thereafter. How many years must the system last if an 18% return on investment is required? The system is tailor made for this job shop and has no market (salvage) value at any time.How can some economic analysis problems be solved more efficiently by annual-worth analysis?