Different projects, investments, or wholesale/retail activities may generate different streams of profits, incomes, or sales revenues over different time horizons Select one: O True O False
Q: A project is economically feasible if: O a. Its external rate of return is less than the minimum…
A: "Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: Consider a palletizer at a bottling plant that has a first cost of $150,000, operating and…
A: Given, i = 8% and n= 30 Annual equivalent cost = first cost(a/p,8%,30) - 17,500 + 25,000(a/f,8%,30)…
Q: QI Table Q1 shows the engineering project with minimum attractive rate of return (MARR) at 15% per…
A: Rate of return for a project or the internal rate of return for a project, denoted as IRR, is…
Q: The economic analysis of two alternatives A and B (MARR=10%) concludes that there is no difference…
A: the minimum acceptable rate of return, often abbreviated MARR, or hurdle rate is the minimum rate…
Q: Correct or Incorrect: The “discounting” in a discounted cash flow approach requires the use of which…
A: (Discounted Cash flow) DCF is an approach that is used to measure the value of the (investment) I…
Q: If a company finances an expansion in its production facilities by issuing $6 million in preferred…
A:
Q: Question 5 a. Using the NPV decision rule evaluate the following independent investment projects…
A: The decision rule of NPV states that a project is to be accepted if has positive NPV and rejected if…
Q: If the appropriate discount rate for this project is 14%, then the net present value (NPV) is…
A: Given interest rate = 14% Present value of each cash flow = cashflow /(1 + rate)^time For year 0 =…
Q: Following is false about discounted cash flow method to choose innovation projects 1.lt calculates…
A: 6. None of the Above In order to calculate NPV, it is an important factor to discount at every…
Q: Maintenance cost for a small bridge with an expected 60 - year life are estimated to be $ 1,000 each…
A: The term "future capital maintenance" refers to the costs a business anticipates to expand in the…
Q: Use i-9% to find the total EUAC of Plan A which has a total investment of $200,000. Out of this,…
A: Interest Rate = 9% total invstment = 200,000 (Land = 1,20,000, & Building = 80,000) Building…
Q: Determine the payback period at an interest rate of 10% per year for an asset that initially cost…
A: Given: Interest rate=10% Cost of asset=$59000 Scrap Value=$1500 Cash flow=$9080 per year Number of…
Q: City engineers are considering two plans for municipal aqueduct tunnels. They are to decide between…
A: Interest rate = 8% = 0.08 Plan A: Initial cost= $3,000,000 Every 10 years cost= $100,000 Plan B:…
Q: want you to provide me the Cash Flow diagram of the problem. Only cash flow diagram, the solution is…
A: A cash flow diagram is a monetary apparatus used to address the sources of income related with a…
Q: Present worth is an equivalence method of analysis in which a project's cash flows are discounted to…
A: Answer - Given in the question - Statement - Present worth is an equivalence method of analysis in…
Q: The Wintergrass Company has an ROE of 15 percent and a payout ratio of 40 percent. What is the…
A: The sustainable growth rate is the growth rate in profits that a company can reasonably achieve,…
Q: 3. Choose the correct answer. Only one answer may be marked/circled. 1. The equal service…
A: 1. Option A is correct because Specified study period Explanation In order to satisfy the equal…
Q: 400 1,500 2,000 a) Suppose that projects A and B are mutually exclusive. Which project would you…
A: A) PROJECT A & B Year PVF Cash Flow (A) PV of CF (A) Cash Flow (B) PV of CF (B) 0 1.0000…
Q: P(A) = 0.2 P(B)= 0.3 Find P(A and B) when events are mutually exclusive.
A: It has been given that, P(A) = 0.2 P(B)= 0.3 Events A and B are mutually exclusive.
Q: The government is planning a hydroelectric project for a river basin. In addition to the production…
A:
Q: (b) Find the time path of capital (K, t), given the following rates of net investment flow…
A: Time path of capital growth is given by - K(t) = K(t -1) (1 - depreciation rate ) + I(t)
Q: Question 1. If a company must choose between two projects, it should proceed with the one that…
A: If a company must choose between two projects, it should proceed with the one that generates a…
Q: Which of the following values comes closest to the net present value of a project that requires an…
A: Here we calculate the net present value by using the given required return and other information and…
Q: 4. The purchase price of a certain new automobile (challenger) being considered for use in your…
A: PLEASE FIND THE ANSWER BELOW. CAPITAL INVESTMENT: Capital investment is the expenditure of money…
Q: A piece of equipment is purchased for $13,000. It is expected to last 5 years and has a salvage…
A: The Annual Capital Cost is the sum of all annual amounts based on the amortization of the Capital…
Q: Question 6 Estimated annual sales for retrigerants of $10,000 increases by $800 per year starting…
A: The annual revenue generated by a firm via the sale of its products. This is distinct from annual…
Q: A manufacturer offers an inventor the choice of two contracts for the exclusive right to manufacture…
A: Given:- Plan 1 annual payment=$52,343 Plan 2 annual payment=$2,273 Royalty=$1.72 Time=10 years…
Q: You have a project with the net cash flow summarized below. The project is not suitable for direct…
A: The reinvestment rate is the return a financial backer hopes to make subsequent to reinvesting the…
Q: The Larkspur Furniture Company needs a new grinder. Compute the present worth for these mutually…
A: Present value (PV) can be calculated by using the following formula.
Q: Match the measures of worth in the first column with an appropriate definition from the second…
A: Annual Worth =Converts all cash flows to an equivalent uniform series over the planning horizon.…
Q: ect costing P250,000 yields a yearly benefit of P80,000 for a period of 10 years with no salvage…
A: Answer is given below
Q: the potential percent gain or loss in changes of variable is taken into account by A. Break even…
A: Answer Explanation As Present worth is an equivalence method which analysis is done that in which a…
Q: You are considering the following project: It pays you $2,500 at the end of the first year, costs…
A: Introduction: The hurdle rate, conjointly referred to as the minimum acceptable rate of come, is…
Q: What is the B/C Ratio for a firm considering an investment in a new manufacturing technology?…
A: The measure that depicts the relative benefits and costs of a project that is proposed in monetary…
Q: The ore of a copper mine in Visayas contains, 0.7 grams of copper per ton. First method of…
A: Grams in ton=907,184.74 0r 907,184.75 Method 1 Copper recovered = (907,184.75×.0.7)…
Q: It refers to the number of years that the original capital investment for the project will take to…
A: Profitability index(PI) is the ratio of PV(present value) of future cash flows which are expected…
Q: Which of the following is true about net present value? O The higher the NPV, the better the return…
A: Net present worth (NPV) is the distinction between the current worth of money inflows and the…
Q: 1)what is the best project based on simple payback 2) What is the best project based on discounted…
A: “Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: The government is considering undertaking one of the four projects A1, A2, A3, and A4. These…
A: The investors choose the projects with all considerations including the project’s costs, benefits,…
Q: A company that makes clutch disks for race cars has the annual net cash flows shown for one…
A: First, cumulative CF should be calculated. Year Cash Flow, $1000 Cumulative CF, $1000…
Q: Three transportation projects have been proposed to increase the safety in and around a residential…
A: We are going to find the NPWs for each alternative to answer this question.
Q: Which of the following values comes closest to the net present value of a project that requires an…
A: Net present value is the net cashflow which is calculated by the reduction of the cash inflow from…
Q: Money is 15% for the following scholarship: 30,000 at the end of each year for 6 years, 40,000 for…
A: Given: The interest rate on money invested is = 15% The first breakup is, at the end of each year…
Q: 1 c(w,q) 29ʻ°/2w1W2 Determine the profit function t(p; w) by solving the profit maximization problem…
A: Answer: Given, Cost function: cw,q=12q22w1w2 To find the profit function, the total revenue function…
Q: Suppose the following cost/benefit matrix is given by the domain expert. Calculate the expected…
A: Given:- P N T…
Q: If real GDP per person were equal to $2,620 in 1900 and grew at a 3 percent annual rate, what would…
A: Initial value of GDP is $2620. To find future value of GDP we use the compound interest method.
Step by step
Solved in 2 steps
- Given: C = 100 + 0.75Yd (where Yd = Y-T)I = 120-600iG = 200T = 20 + 0.2YMs/P = 300Md/P = 50+0.5Y-600i consumptionI want you to provide me the Cash Flow diagram of the problem. Only cash flow diagram, the solution is already there. Thanks in advance! The annual estimated cash flow is $140,000. The salvage value will be 12% of the initial price after 5 years. The discount rate (r) is 18% Let us assume the initial price of the doughnut machine be X. PV of cash inflows=PV of cash outflows$140,000×PVAF4,18%+.12X×PVF5,18%=X$140,000×2.69006180465+.12X×0.43710921621=X$376,608.652651=X-0.05245310594$376,608.652651=0.94754689406XX=$397,456.479475 The maximum purchase price of the doughnut machine is $397,456.48.Calculation question: Suppose the following data accurately estimates the costs and benefits you outlined in #1. Calculate NPV assuming a discount rate of 4%. Should ISU invest in this project? Year Costs Benefits 0 1000 400 1 200 500 2 200 500 3 200 500
- The surface area of a certain plant that requires painting is 8 ,000 sq ft. Two kinds of paint are availablewhose brand are J and K .Paint J costs P1.40 per sq.ft but needs renewal at the end of every 4 years while paint K costsP1.8 per square ft. If money is worth 16% effective , how often should paint K be renewed so that it will be aseconomical as paint J? A) 5.6.years C) 3.9 yearsB) 4.2 years D) 5.3 yearsA company that makes clutch disks for race cars has the annual net cash flows shown for one department. Year NCF, $1000 0 −65 1 30 2 84 3 −10 4 −12 (a) Determine the number of positive roots to the rate of return relation. (b) Calculate the internal rate of return. Is there a negative root? How is it treated? (c) Calculate the external rate of return using the return on invested capital (ROIC) approach with an investment rate of 15% per year (as assigned by your instructor, solve by hand and/or spreadsheet).a) What is the NPV of each project? Which projects should Xia undertake, and how much cash should it retain? b) What is the total value of Xia’s assets today? c) What cash flows will the investors in Xia receive? Based on these cash flows, what is the value of Xia today? d) Suppose Xia pays any unused cash to investors today, rather than investing it. What are the total cash flows to the investors in this case? What is the value of Xia now?
- Engr. Roque owner of the HarRoq’s Ice Plant is monitoring the cashflow of the plant. Based on the following information, how many ice blocks must produce and able to sell per month in order to break even? Ice block price Php 50.00/ice block Cost of electricity Php 30.00/ice block Tax to be paid Php 3.00/ice block Real estate Tax Php 4,500.00/month Salaries and wages Php 30,000.00/month Others Php 15,000.00/monthThe following are the cash flows of two projects: Year Project A Project B 0 $ (330 ) $ (330 ) 1 160 230 2 160 230 3 160 230 4 160 a. Calculate the NPV for both projects if the discount rate is 12%. (Do not round intermediate calculations. Round your answers to 2 decimal places.) b. Suppose that you can choose only one of these projects. Which would you choose? multiple choice Project B Project A Neither1. Which projects would you recommend Handstar pursue based on the NPV approach? Based on the case above
- 12. Which of the following statements is FALSE? A. We can use sensitivity analysis to identify important factors. B. Sensitivity analysis considers the effect on net present value (NPV) of changing multiple project circumstances. C. changing the cost of capital will change the investment decision. D. Estimates of the cash flows and cost of capital are often subject to significant uncertainty."All growth models. You are evaluating the potential purchase of a small company that currently generates $42,500 in cash flow after taxes (D0 = $42,500). Based on a review of similar risk investment opportunities, you should earn a return rate of 18% from the proposed purchase. Since you're not very sure about future cash flows, you decide to calculate the value of the company assuming some possibilities for the cash flow growth rate. a) What is the value of the company if cash flows are expected to grow at an annual rate of 0% from now on? b) What is the value of the company if cash flows are expected to grow at a constant annual rate of 7% from now on? c) What is the value of the company if cash flows are expected to grow at an annual rate of 12% for the first 2 years and then, starting from year 3, the growth rate decreases to a constant annual rate of 7%?"If consumption is $30,000 when income is $35,000, and consumption increases to $35,000 when income increases to $43,000, the MPS is Select one: O a. None of the options O b. 0 O c. 0.625 O d. 0.375