Milwaukee Machine Tool is planning to buy a machine for S15,000 with a salvage value of 20% of the initial cost after a life of 10 years. The company estimates it will need $900 for supplies, $250 for maintenance, S100 for utilities and S1,500 for overhead. They estimate these will increase by S1200, 8%, 10% and $200 respectively over the 10-year machine life. If interest rate is 5% per year, what is the net present value of the project?
Q: (d) What will be the new optimal price and quantity of SinPharm if FC increases? (e) Has the…
A: Fixed cost is the monetary value incurred on the fixed factors . It is constant over period of time…
Q: F. Consider, a discrete compounding scheme of a nominal interest rate of 12%. Chis scheme issues…
A: Future worth is the sum that a resource will be worth starting sometime in a future date, in light…
Q: A. (CHAPTER 6) Suppose there are two islands. The total population on the two islands is 800 people.…
A: Introduction Suppose there are two island. The total population on two island is 800 people. a)…
Q: QUESTION 6 1/e Z-E Z-E The figure above demonstrates: Oa. The higher the value of the yen, the…
A: Here, the given graph explains the relationship between the reciprocal of exchange rate and the…
Q: Jim's Camera shop sells two high-end cameras, the Sky Eagle and Horizon. The demands for these two…
A: Total revenue is the total monetary value received by selling the total output produced. TR = P×Q…
Q: 14. With flexible exchange rates, central banks do not have to finance cur- rent account deficits…
A: The rate that depicts the measurement of one currency in terms of another currency is known as the…
Q: Suppose that the money supply increases by 20 percent. If there is no inflation, what does the…
A: Quantity theory of money shows the relationship between money supply and nominal GDP
Q: Suppose the government wants to raise additional tax revenues with the least disruption to…
A: Tax revenue is the product of tax per unit and quantity sold after tax.
Q: Suppose T- 0.15Y in time 1. In time two, output Y increases by 10% and the new tax T2 0.3Y2 (where…
A: Disposable income refers to that part of income that is left after the payment of taxes and can be…
Q: Which is NOT a common characteristic of financial intermediaries? * A. None of the choices. B.…
A: Financial intermediaries give a center ground between two gatherings in any monetary exchange. A…
Q: baid along with P620 of interest. Determine the following: 1. Discount rate, %? 2. What is the…
A: Both part solved below,
Q: Suppose that the annual rates of growth of real GDP in Econoland over a five-year period were as…
A: Average = (Sum of observation / Number of observation) A negative growth rate implies recession.
Q: Question 39 In a hypothetical economy, if income increases by $1 in the first round of the…
A: Income increases in each round by Round 1 by $1 Round 2 by MPC* $1 = $0 58.
Q: MT QUIZ 3 A tariff on foreign cars imported into the Philippines will: 1. Benefit consumers 2.…
A: Trade restrictions are imposed by various countries to protect the domestic industries and to…
Q: Which of the following is not an illustration of the notion of opportunity cost A. The…
A: Opportunity cost is the lost of next best available option. Taking each option one by one.
Q: A company owns an asset that is worth $245,000 and there is a 6% chance that it will lose $185,000…
A: In economics, utility means pleasure or satisfaction that customers get from using a product or…
Q: Describe how the following firms could implement price discrimination (or an advanced pricing…
A: Price discrimination is a business technique that involves charging clients various rates depending…
Q: To encourage spending to offset a lower demand for goods and services, the government will implement…
A: Monetary policy refers to changes in money supply in the economy.
Q: You are evaluating the possibility that your company bids $150,000 for a particular construction…
A: Cost refers to all the expenses that incur in an production unit. It includes the fixed and variable…
Q: D7) Much of the growth in Southeast Asia is due to ________, and many African nations have based…
A: When comparing the economic growth of different nations, it can be seen that the drivers of economy…
Q: CD Solutions Ltd. manufactures and replicates CDs for software and music recording companies. CD…
A: Break even is a situation where total revenue is equals to total cost
Q: In the country of Winterfell, the velocity of money is constant. GDP growth is 4% per year, the…
A: Real interest rate refers to the nominal interest adjusted for inflation.
Q: 16. The variability of real exchange rates has been much greater when a country adopts of fixed…
A: When talking about fixed exchange rate system, it can be said that this system is given by Bretton…
Q: Consider a self employed worker who owns a firm that produces output q which sells for a price of p…
A: Answer-
Q: Suppose a new contracting environment tha requires clearing fewer legal hurdles is considered. This…
A: Marginal cost refers to change in total cost or total variable cost with respect to change in…
Q: Isocost line graph and tables
A:
Q: CH 13 Q3 Homework• Unanswered . Due Today, 11:59 PM Suppose there is a fireworks show being…
A: Reduce the quantity of needless resources utilized to generate a particular product, including human…
Q: A cell phone factory has a total production cost of C - 150x+10000 and a revenue function R(x) -…
A: Total revenue is the revenue that is achieved by selling given units of a commodity. Total cost is…
Q: Determine the multifactor productivity for the combined input of the labor and the machine time…
A: Multifactor productivity is the ratio of output and combined costs of inputs and it determines the…
Q: The cust for long lerm care is increasing because the population is gelling less mobile the…
A: Health is most important factor in capital formation because a good health is the Indicator of…
Q: State which of these statements is false: * A futures contract is fully customizable A futures…
A: The correct answer is given in the second step.
Q: in monopoly, market power permits you to price above MC. What limits how high a price you can set?…
A: In monopolistic market there is a single firm selling unique good.
Q: Assume that Vietnam is an open economy(i.e it trades with the rest of the world) but does not allow…
A: The Mundell-Fleming model given by Robert Mundell and Marcus Fleming tries to integrate…
Q: The gym teacher wants to know how many students attend games. She asks 80 students throughout the…
A: Sample is known as the data that is gathered to represent the features of the population. In this…
Q: Similarities of the effects of the Spanish Flu and the Ukraine-Russia War on the economies of…
A: Similarities The Spanish flue expanded in 3 phases: the first one in the springtime of 1918, the…
Q: A perfectly elastic demand implies that Select one: a. quantity demanded and price change by the…
A: Elasticity measures the responsiveness of quantity demanded to changes in price level.
Q: 3) Assume that a firm which produces an output according to the following function is attempting to…
A: Given information Production function q=(0.5K0.5+0.5L0.5)0.5 P=16 W=1 V=1Profit maximizing…
Q: tight monetary policy is an indication that there is an on going or expected increase in the level…
A: In a tight monetary policy, the Fed's actions decrease the money supply, and in a loose monetary…
Q: S = 20L0.30C0.70 this formula L represents the units of labor input and C the units of capital…
A: given that The quantity of steel to be produced is 40,000 tons of steel. (a) The optimization…
Q: Why does an increase in money growth cause inflation, ceteris paribus?
A: In an economy, money supply is the macro-economic variable that has a significant impact on the…
Q: Consider this economy: C = 100 + 0.5Y 1= 400 + 0.1Y Drag and drop options on the right-hand side and…
A: At equilibrium, aggregate output is equal to the sum of consumption, investment and government…
Q: looking at the functional HR strategy that Nestle use to implement their Pet Food strategy, what was…
A: Introduction The corporate structure of Nestle Purina has a matrix structure. This means there are…
Q: If there were 20 firms in this market, the short-run equilibrium price of titanium would be $ per…
A: As the minimum point of average variable cost, the marginal cost curve is reduced. The supply…
Q: Consider an individual whose utility depends on consumption and hours of leisure enjoyed. Answer the…
A: Utility is the level of satisfaction that consumers of a certain good derive from the good. The…
Q: Consider a town in which only two residents, Sam and Teresa, own wells that produce water safe for…
A: Disclaimer: Since it is a multipart question, I am providing you with the answer to the first three…
Q: 1. Based on the information on the table above, calculate the four-firm concentration ratio and the…
A: The Herfindahl-Hirschman Index (HHI) can be calculated by adding the sum of the square of the market…
Q: 4. ABC hotel in Ottawa has 20 rooms. Based on the past date, the hotel man- ager estimates t 15%…
A:
Q: Scenario1: I choose Almarai company a. If your company can make two goods, use a numerical table and…
A: Disclaimer :- as you posted multipart questions we are supposed to solve the first 3 questions only…
Q: In the country of Economica, the total labor force consists of 5,000 workers. 250 of these workers…
A: The labor force that is also known as the presently active population, is made up of all those who…
Q: 8
A: Investment banks are the banks that help startup companies to launch. It acts as an intermediary…
Step by step
Solved in 3 steps
- An asset for drilling was purchased and place in service by a petroleum production company. Its initial investment is P60,000 and it has an estimated salvage value of P12,000 at the end of an estimated useful life of 14 years. Compute the book value at the end of the 5th year of life using SLM. a. P48,257.00 b. P42,857.00 c. None of the above d. P45,572.00A harvester was purchased 4 years ago for $100,000. The current market value is $45,000, which will decline as follows over the next 5 years: $40,000, $33,500, $28,000, $24,000, and $17,000. The O & M costs are estimated to be $16,000 this year. These costs are expected to increase by $5000 per year starting year 2. MARR = 10% The foregone interest in year 4 is _______________.Hagar Industrial Systems Company (HISC) is trying to decide between two different conveyor belt systems. System A costs $275,000, has a 4-year life, and requires $81,000 in pretax annual operating costs. System B costs $355,000, has a 6-year life, and requires $75,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Suppose the company always needs a conveyor belt system; when one wears out, it must be replaced. Assume the tax rate is 22 percent and the discount rate is 9 percent. Calculate the EAC for both conveyor belt systems. Please lay out initial input of the problems and your calculations of cash flow, NPV, and EAC in an excel format.
- A firm can purchase a centrifugal separator (5-year MACRS property) for $22,000. The estimated salvage value is $4,000 after a useful life of six years. Operating and maintenance (O&M) costs for the first year are expected to be $2,200. These O&M costs are projected to increase by $1,000 per year each year thereafter. The income tax rate is 24% and the MARR is 11% after taxes. What must the uniform annual benefits be for the purchase of the centrifugal separator to be economical on an after-tax basis?A process plant making 5000kg /day of a product selling for $1.75 per kg has annual directproduction costs of $2 million at 100 percent capacity and other fixed costs of $700,000. What isthe fixed charge per kg at the break-even point? If the selling price of the product is increased by10 percent, what is the dollar increase in net profit at full capacity if the income tax rate is 35percent of gross earnings?uppose that you purchased a HVAC system five years ago for $75, 000. The O&Mcosts are $15, 000 this year and are expected to increase by $1, 000 each year for the next five yearsthen remain the same for the following years.The current salvage value of the system is $15, 000; salvage value after one year is estimated tobe $12, 000; after two years, $11, 000; after three years, $10, 000; after four years, $9, 000; and so on.A new industrial HVAC system is available for purchase at a price of $95, 000, including instal-lation. The market value of the new system will decrease at a rate of 15% each year. The O&Mcosts are expected to be $1, 000 in the first year, and will increase at a rate of 20% each year. Themaximum service life of the new system is 10 years. Assume that your company uses an interestrate of 10% for all project evaluations.(a) Find the remaining economic life of the currently owned asset.(b) What is the economic service life of the new system?(c) Use the…
- 9.1 The Arkansas Division of ADM, a large agricultural products corporation, pur- chased a state-of-the-art ground-leveling system for rice field preparation 3 years ago for $120,000. When purchased, it had an expected service life of 10 years, an estimated salvage of $25,000 after 10 years, and AOC of $30,000. Current account book value is $80,000. The system is deteriorating rapidly; 3 more years of use and then salvaging it for $10,000 on the international used farm equip- ment network are now the expectations. The AOC is averaging $30,000. A substantially improved, laser-guided model is offered today for $100,000 with a trade-in of $70,000 for the current system. The price goes up next week to $110,000 with a trade-in of $70,000. The ADM division engineer estimates the laser-guided system to have a useful life of 10 years, a salvage of $20,000, and an AOC of $20,000. A $70,000 market value appraisal of the current sys- tem was made today. If no further…A lift truck priced at $38,000 is acquired bytrading in a similar lift truck and paying cash for theM09_PARK9091_06_GE_C09.indd 506 10/22/15 5:16 PMProblems 507remaining balance. Assuming that the trade-in allowance is $9,000 and the book value of the asset tradedin is $7,808, what is the cost basis of the new assetfor the computation of depreciation for tax purposes?Consider a five-year MACRS asset, which can be purchased at $80.000. Thesalvage value of this asset is expected to be $42,000 at the end of three years.What is the amount of gain (or loss) when the asset is disposed of at the end of three years?(a) Gain $11,280(b) Gain $9,860(c) Loss $9,860(d) Gain $18,960
- A recapping plant is planning to acquire a new Diesel generating set to replace its resent unitwhich they run during brownouts. The new set would cost ₱ 135,000 with a five (5) year-life,and no estimated salvage value. Variable cost would be ₱ 150,000 a year.The old generating set has a book value of ₱ 75,000 and a remaining life of 5 years. Itsdisposal value now is ₱ 7,500 but it would be zero after 5 years. Variable operating cost wouldbe ₱187,500 a year. Money is worth 10%.Which is profitable, to buy new generator or retain the old set? Support answer using:a) Equivalent Uniform Annual Cost (EUAC) MethodA recapping plant is planning to acquire a new Diesel generating set to replace its resent unitwhich they run during brownouts. The new set would cost ₱ 135,000 with a five (5) year-life,and no estimated salvage value. Variable cost would be ₱ 150,000 a year.The old generating set has a book value of ₱ 75,000 and a remaining life of 5 years. Itsdisposal value now is ₱ 7,500 but it would be zero after 5 years. Variable operating cost wouldbe ₱187,500 a year. Money is worth 10%.Which is profitable, to buy new generator or retain the old set? Support answer using:a) Annual Cost Methodb) Equivalent Uniform Annual Cost MethodA new machine costs $899,090 and falls in a 29.50% CCA class. The machine will have zero value after 5 years of use but will save $417,680 annually in operating costs before taxes in those five years. Assume a tax rate of 34.17%. Using a required return of 15.11%, what is the equivalent annual cost (EAC) of the machine purchase, considering the annual cash flow, initial purchase, and CCA tax shield? Options $59,682 $61,252 $62,823 $64,393 $65,964