Consider the following analysis of two alternatives, X & Y: YR X Y 0 -200 -1000 1 30 250 2 30 250 3 30 250 4 30 250 5 100 400 The MARR is 10%. Calculate the incremental rate of return in percent to the nearest 0.1 percent. Please explain each step
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Consider the following analysis of two alternatives, X & Y:
YR | X | Y |
0 | -200 | -1000 |
1 | 30 | 250 |
2 | 30 | 250 |
3 | 30 | 250 |
4 | 30 | 250 |
5 | 100 | 400 |
The MARR is 10%. Calculate the incremental
Please explain each step
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- Assume that the net present value of a project is $ 3870 at 10%, and -$1853 at 12%. Use linear interpolation to compute the rate of return correct to the nearest tenth of a percent. A) 11.2% B) 10.8% C) 10.5% D) 11.9% E) 11.4%If the risk-free rate is 4.8 percent and the risk premium is 6.8 percent, what is the required return? (Round your answer to 1 decimal place.) Required Return: ___.__%Calculate the APR of the following investment, entered as a percentage (Example: if your answer is 14.5%, enter 14.5 and not 0.145) Year Number Cashflow 0 -11000 1 3000 2 3500 3 2900 4 2800
- For investment A, the probability of the return being 20.0% is 0.5, 10.0% is 0.4, and -10.0% is 0.1 Compute the standard deviation for the investment with the given information. (Round your answer to one decimal place.) a. 85.00% b. 15.00% c. 34.00% d. 17.00% e. 9.00%The following table shows the one-year return distribution of Startup, Inc. Calculate: 1. The expected return. 2. The standard deviation of the return. Probability 40% 20% 20% 10% 10% Return - 100% - 75% - 50% - 25% 1000%Assume that an investment is expected to generate the following returns: a 10% chance of a $1,400 return, a 50% chance of a $6,600 return, and a 40% chance of a $1,500 return. What is the expected rate of return on this investment? Note: The solution must be displayed on an Excel sheet using Excel functions such as =PV(...) and =FV(...) etc.
- Suppose the returns on an asset are normally distributed. The historical average annual return for the asset was 5.2 percent and the standard deviation was 10.6 percent. a. What is the probability that your return on this asset will be less than –9.7 percent in a given year? Use the NORMDIST function in Excel® to answer this question. b. What range of returns would you expect to see 95 percent of the time? c. What range of returns would you expect to see 99 percent of the time?Find the total value TV of the given income stream and also find its present value PV (at the beginning of the given interval) using the given interest rate. (Round your answers to the nearest cent.) R(t) = 40,000 + 1,000t, 0 ≤ t ≤ 10, at 5% TV = $ PV = $Your expectations from a one year investment in Wang Computers are as follows: Probability Rate of Return .15 -.10 .15 -.20 .35 .00 .25 .15 .10 .15 expected rate of return? standard deviation? coeefecient of variation on investment?
- Calculate the HPR of the following investment, entered as a percentage (Example: if your answer is 14.5%, enter 14.5 and not 0.145) Period Cashflow 0 -14100 1 3300 2 3300 3 3100 4 2800Which alternative should be selected using the incremental rate of return analysis, if MARR =11.0%? Do- nothing A B C D First Cost 0 $10,000 $4000 $10,000 $7000 Annual benefit 0 1,806 828 1,880 1,067 Life 10 Years ROR 12.5% 16.0% 13.5% 8.5% a. B, because its ROR is the highest b. Something other than C, because C costs the most initially c. C, because the C-B increment has a ROR of 11.78% and the A-B increment has a ROR of 10.5% d. C because C has the highest annual benefitSuppose you have a project that has a 0.4 chance of tripling your investment in a year and a 0.6 chance of halving your investment in a year. What is the standard deviation of the rate of return on this investment? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.) What is the standard deviation?