Which of the following statements is not true O Profitability index will increase with an increase in internal rate of return O If the Profitability index of a project is less than one, its NPV should be less than zero O The NPV of a project is the sum of all discounted cash
Q: Given a project with three paths and their corresponding path lengths: AB-C: 25 days, A-D-E: 15…
A: Answer - Given in the question - Given a project with three paths and their corresponding path…
Q: A company manufacturing medical personal protective equipment (PPE) in your province is regulated by…
A: Since you have asked a question with multiple subparts and these subparts are further divided into…
Q: The internal rate of return on some project is defined as the rate of interest that a. makes the NPV…
A: The answer is - a. Makes the NPV of the project equal to zero.
Q: Examine the sensitivity of the project to changes in the manufacturing throughput, discount rate and…
A: Project: It refers to any task that a company undertakes and that has to completed within some time.…
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: The cost of an item is P200,000. Cost is P20,000 per year. What would be the capitalised cost of a…
A: Capitalized cost is the current value of future cash flows that will never end. Instances of…
Q: A total of $150,000 was invested in two different projects identified as A1 and 82. If the overall…
A: Solution: A total of $ 150,000 was invested in two different projects identified as A1 and B2. If…
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: $30,000 and is considering three possible independent projects. Project A has a present outlay of…
A: *Answer:
Q: Determine the number of acceptable mutually exclusive bundles for the four independent projects…
A: Since there are 4 projects, so number of possible bundles = 24 16, there would be 16 possible bundle…
Q: All of the following are factors that affect the effective MARR of a project, except: (a) Project…
A: Project risk is directly associated with MARR. If the risk is higher, then MARR value would be…
Q: Define Minimum Attractive Rate of Return (MARR). Explain it through your own understanding. State…
A: In a market, especially in the capital market, every individual enters to get some level of benefit…
Q: Develop all (a) acceptable, and (b) nonacceptable mutually exclusive bundles for four independent…
A: The mutually exclusive bundle for 5 independent projects can be calculated as follows: The mutually…
Q: Two projects are independent if the expected costs and the expected benefits of each project do not…
A: Given there are two projects, expected costs of two projects are different and expected benefits of…
Q: Tom, the owner of Burger Palace, determined that the weighted average cost of capital is 8%. He…
A: The MARR should be derived using the risk premium approach. This implies that the project has higher…
Q: Product X is sold for $500 per unit. The total cost of production per year, including capital…
A: Answer: Given information: Price of product X = $500 Total cost function:…
Q: Suppose that KCA University intends to introduce a new course from September 2020. The college…
A: The total cost consists of total variable cost and total fixed costs. TC =VC+FCVC =AVC*Q Total…
Q: ngineering Economics Bawal gumamit ng excel( Don't use Excel) A firm is considering the…
A:
Q: Harris International currently pays a dividend of $3.24 per share on its preferred stock that sells…
A: The amount of funding can be calculated as follows. The calculated value shows that the amount of…
Q: b) Kenya is in the advanced stages of preparing to manufacture COVID-19 vaccines locally. The…
A: i) Given, 112 have the capacity to produce JJ and AZ. And, 79 have capacity to manufacture JJ and AZ…
Q: An investment with a first cost of $265,000 leads to annual benefits of $51,000 over a period of ten…
A: Benefit Cost ratio ( BCR The benefit-cost ratio is a monetary or qualitative statistic that depicts…
Q: Fixed costs are irrelevant in decisions about whether a product should be retained or be dropped.…
A: 22. The required rate of return is the maximum rate of return that an investment project yield be…
Q: Consider the validity of the following statements: I. Economic cost may be lower than accounting…
A: Economic cost is the sum of all losses of any products with a monetary value associated to them by…
Q: Which of the following would be an advantage of using a Project Management software application…
A: Project management software help in planning,collaboration,organise resources,reporting,project…
Q: A pharmaceutical company has spent $500 million to date working on a blood pressure treatment. It…
A: Answer 1 Given Information Money spent till date = $ 500 million Money needed for FDA approval = $…
Q: Which of the following statements is correct? O a. MARR is set higher than the WACC b. MARR is set…
A: Note: We will answer one question as the exact one was not specified. Please resubmit a new question…
Q: For mutually exclusive projects, the internal rate of return and the net present value give…
A: The Internal Rate of Return and the Net Present Value are the types of Capital Budgeting techniques…
Q: The Costa Coffee Company (for short CCC) is anticipating a major expansion of its franchised coffee…
A: The function of an investment is described as a summary of variables that impact the aggregate…
Q: Three mutually exclusive projects are being considered by Sesame Street Productions (SSP). The…
A: Benefit Cost Ratio is defined as the metric used in finance that helps in the assessment of…
Q: dropped. True False 22 The required rate of return is the maximum rate of return that an investment…
A: 21 - TRUE Since Fixed costs must be paid irrespective of the Price, quantity Or profitability of…
Q: Quentin is also considering one additional project, Project F. It proposes that the company…
A: Capital budgeting is the process using which investment decisions regarding long-term assets get…
Q: The term "engineering economic decision" refers to all investment decisions relating to engineering…
A: Economic decisions are the decisions where economic entities have to choose what to do in a…
Q: The estimated beta (/3) of a firm is 1.7. The market return (rm) is 14 %, and the risk-free rate…
A:
Q: Ann and Bob are real estate developers, and are considering the following projects: There are two…
A: Profit structure is following : Hotel Profits 100 m Golf course profits , no hotel 100 m…
Q: Is it possible or even desirable for strategic planning for project management to include ways to…
A: Strategic planning This process entails determining the order in which those goals should be…
Q: Identify the one false statement about the internal rate of return. a. The IRR is also known as the…
A: The internal rate of return refers to the discount rate which is used to measure the profitability…
Q: McBurger, Inc., wants to redesign its kitchens to improve productivity and quality. Three designs,…
A: Given, Number of sandwiches=500 Cost of sandwich= $1.30 The selling price of sandwich= $2.50
Q: An investor wishes to invest P2,000,000. Venture A, requiring P2,000,000 will return 8%. Venture B,…
A: Given: An investor invest = P2,000,000 The return in Venture A is = 8% An investor B invest =…
Q: What do you know about the mathematical value of the internal rate of return of a project under each…
A: Internal rate of return refers to the investments in the economy that are backed by potential…
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: 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 minimum attractive rate of return (MARR), is considered as the lowest interest rate that will…
A: Note:- Since we can only answer one question at a time and as the exact one is not specified, we'll…
Q: Which of the following is NOT a feature of capacity planning? OIt is required in the long-term and…
A: Capacity planning: Capacity planning will decide what will be the overall result and how much output…
Q: 1. In the blanks below, mark the following statements as either TRUE (T) or FALSE (F). 1.…
A: According to Bartleby policy only first three subpart solve here mention remaining questions…
Q: A firm has a capital budget of $30,000 and is considering three possible independent projects.…
A: Given Information Capital budget= $30,000A present outlay of Project A= $12,000Yields of Project…
Q: Q2: Assume that a revenue function R(x) and a total cost function C(x) here have been used in…
A: Break even output is such level of output where no profit, no loss is made.
Q: Development projects done by Standalone Products are subsidized by a government grant program. The…
A: Given information Two project Checkweigher and Scheduler Checkweigher Project First cost =$32000…
Step by step
Solved in 2 steps
- For mutually exclusive projects, the internal rate of return and the net present value give consistent accept/reject decisions if: A.the investment projects have identical cash flows in the final year. B.the required rate of return is less than the discount rate, which causes the net present value profiles of the two projects to intersect. C.the net present value profiles for both projects do not intersect. D.the investment projects have equal lives.Engineering Economics Bawal gumamit ng excel( Don't use Excel) A firm is considering the development of several new products. The products under consideration are listed here; the products in each project group are mutually exclusive. (Insert Table) At most one product from each group will be selected. The firm has MARR of 10% per year and a capital investment budget limitation on development costs of P2,100,000. the life of all products is assumed to be ten (10) years. Assume no market values at the end of 10 years.A company has a production capacity of 500 units per month and its fixed costs are P250,000 a month. The variable costs per unit are P1,150 and each unit can be sold for P2,000. Economy measures are instituted to reduce the fixed costs by 10 percent and the variable costs by 20 percent. Determine the old and the new break-even points. What are the old and the new profit at 100 percent capacity?
- Which of the following power plants is better investment, assuming 8% interest on the sinking fund and no salvage value in either case, taxes/insurance at 10% and interest on capital at 12%. Use ROR and Present Worth Method. - Coal plant which costs P1M, last 10 years and cost annually P100k to operate. - Fuel-oil plant which costs P800k will last 7 years and cost annually P70k to operate.The investor-developer would not be comfortable with a 7.8 percent return on cost because the margin for error is too risky. If construction costs are higher or rents are lower than anticipated, the project may not be feasible. The asking price of the project is $4,600,000 and the construction cost per unit is $80,400. The current rent to justify the land acqusition is $1.3 per square foot. The weighted average is 900 square feet per unit. Average vacancy and Operating expenses are 5% and 35% of Gross Revenue respectively. Use the following data to rework the calculations in Concept Box 16.2 in order to assess the feasibility of the project: Required: a. Based on the fact that the project appears to have 9,360 square feet of surface area in excess of zoning requirements, the developer could make an argument to the planning department for an additional 10 units, 250 units in total, or 25 units per acre. What is the percentage return on total cost under the revised proposal? Is the…13) The independent projects must have positive and negative cash flows to obtain a PW value that can exceed zero, which means that they must be revenue projects. Select one: True False 14) capitalized cost is considered as the present worth of projects that has a short life or when the planning horizon is very short. Select one: True False
- Complete Solution needed. A plant produces 300 units of equipment a month of Php 3,600 each. A unit sells for Php 4,800. The company has 10,000 shares of stock at Php 200 par value whose annual dividend is 20%. The fixed cost of production is Php 120,000 a month. a) What is the break-even point? b) What is the unhealthy point? c) What is the profit if production is 60% of capacity? (Specify if it is a gain or loss)A cell phone company has a fixed cost of $1,000,000 per month and a variable cost of $22 per month per subscriber. The company charges $33 per month to its cell phone customers. a.What is the annual breakeven point for this company? b. The company currently has 95,000 subscribers and proposes to raise its monthly fees to $39.95, what is the new annual break-even point if the variable cost increases to $25 per customer per month? c.lf 20,000 subscribers will drop their services because of mönthly increase in part (b), will the company still be profitable?A fabrication company engaged in production of a motor part has a production capacity of 700, 000 pieces per year. But, it is just operating at 62% of its full capacity due to unavailability to finance the importation of their materials. The company has an annual income of P 430, 000.00, annual fixed cost are P 190, 000.00 and variable costs are P 0.348 per unit. How many productions of parts must be produced for break-even point? Given:Required:Solution:
- If the capital budget limit is $120,000, the MARR is 10% per year, and all projects have a 10-year life, rank and select from the independent projects using the (a) PI measure, (b) IROR measure, and (c) PW at the MARR. (d) Are different projects selected using the three methods? First Net Income, IROR, PW at Project Cost, $ $ per Year % 10%, $ A −18,000 4,000 18.0 6,578 B −15,000 2,800 13.3 2,205 C −35,000 12,600 34.1 42,422 D −60,000 13,000 17.3 19,879 E −50,000 8,000 9.6 −843A commercial Bank in Zambia has a net profit after taxes of K10 million with an asset base of K100 million. It is also noted that the equity capital investment for the bank amounts to K20 million. Based on the foregoing, calculate the Return on Equity (RoE) and Return on Assets (RoA). Ensure to also comment on the relationship between the two performance parameters ROE and ROA.Initial Cost: ($300,000)The Study Period: 15 yearsSalvage (Market) Value of the Project: 12% of the initial costOperating Costs in the first year: ($7,500)Operating Costs increase by 5% per yearBenefits in the first year: $30,000 Benefit increase by 13% per yearMARR: 9% per year 1)Determine the NPW, AW, FW of the project. 2) Is the Project acceptable? WHY?