The expected average rate of return for a proposed investment of $6,000,000 in a fixed asset, using straight-line depreciation, with a useful life of 20 years, no residual value, and an expected total net income of $12,000,000 over the 20 years is   a.  20%   b.  10%   c.  40%   d.  5%

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A: Average Rate of Return = Annual Return / Average Investment

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A: b. 52.43%

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Q: The amount of the estimated average annual income for a proposed investment of $73,000 in a fixed…

A: Answer Calculation of Estimated average annual Income: = Expected total income yield / useful life…

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A: NPV is an investment appraisal method. It is the estimated increase in wealth of shareholders of the…

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A: Cash flows are inflows and outflows of cash.

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A: Formula: Average total income = Expected total income / 4 years

Q: 1.) A project is estimated to cost P100,000, lasts 8 years and have a P10,000 salvage value. The…

A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…

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A:

Q: Most Company has an opportunity to invest in one of two new projects. Project Y requires a $325,000…

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A: Solution 4: Project Y Chart Values are based on           n= 4         i= 8%…

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Q: The amount of the average investment for a proposed investment of $132,000 in a fixed asset with a…

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Q: Consider a four-year project with the following information: Initial fixed asset investment =…

A: The question gives the following information:

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A: Formula: Average investment = (Initial value of investment + Closing value of investment) / 2

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A: Payback period is the amount of time required to recover initial investment. it can be calculated…

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.