Construction Accounting And Financial Management (4th Edition)
4th Edition
ISBN: 9780135232873
Author: Steven J. Peterson MBA PE
Publisher: PEARSON
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Chapter 17, Problem 7DQ
Why do the
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What is annual worth method, future worth method, and present worth method in comparing alternative, how to choose the best option in the said three method?
When using annual worth to evaluate the attractiveness of a single alternative, what value is the calculated AW compared to? a. PW b. FW c. 0.0d. MARR.
Write the various applications that call for annual-worth analysis techniques?
Chapter 17 Solutions
Construction Accounting And Financial Management (4th Edition)
Ch. 17 - What is the do nothing alternative?Ch. 17 - Why is it important to compare all possible...Ch. 17 - What is a sunk cost? How should sunk costs be...Ch. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - What is a study period? Why must all of the...Ch. 17 - Why do the NPV, the future worth, and the annual...Ch. 17 - Why must you use mutually exclusive alternatives...Ch. 17 - Why would one use the capital recovery with return...Ch. 17 - What are the weaknesses of the payback period...
Ch. 17 - What types of investments does the payback period...Ch. 17 - What is the advantage of using the project balance...Ch. 17 - A manager has up to 190.000 available to invest in...Ch. 17 - A manager has up to 200,000 available to invest in...Ch. 17 - Determine the MARR for a company that can borrow...Ch. 17 - Determine the MARR for a company that can invest...Ch. 17 - Your company is looking at purchasing a dump truck...Ch. 17 - Your company is looking at purchasing a loader at...Ch. 17 - Your company needs to purchase a new track hoe and...Ch. 17 - Your company needs to purchase a new track hoe and...Ch. 17 - Your company needs to purchase a track hoe and has...Ch. 17 - Your company needs to purchase a truck and has...Ch. 17 - Prob. 23PCh. 17 - Determine the incremental net present value for...Ch. 17 - Determine the future worth for Problem 17. Should...Ch. 17 - Determine the future worth for Problem 18. Should...Ch. 17 - Prob. 27PCh. 17 - Determine the annual equivalent for Problem 18....Ch. 17 - Determine the rate of return for Problem 17....Ch. 17 - Determine the rate of return for Problem 18....Ch. 17 - Your company has 100,000 to invest and has...Ch. 17 - Your company has 200,000 to invest and has...Ch. 17 - Determine the incremental rate of return for...Ch. 17 - Prob. 34PCh. 17 - Your company has purchased a new track hoe for...Ch. 17 - Your company has purchased a new excavator for...Ch. 17 - Determine the payback period without interest for...Ch. 17 - Determine the payback period without interest for...Ch. 17 - Prob. 39PCh. 17 - Determine the payback period with interest for...Ch. 17 - Draw a project balance chart for Problem 17.Ch. 17 - Draw a project balance chart for Problem 18.
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- How does the size of the initial investment affect the internal rate of return on the net present value models?arrow_forwardIf alternatives’ useful lives are different, B/C ratio analysis should preferably be based on: Select one: a. present worth b. annual worth c. future worth d. RORarrow_forwardSolve for the annual worth method.arrow_forward
- When using present worth to evaluate the attractiveness of a single investment alternative, what value is the calculated PW compared to? a. 0.0b. MARR c. 1.0 d. WACC.arrow_forwardwhat is apr? do we use APR or EAR when we are calculating the present value of investment? is APR and EAR ever equal? if so, when?arrow_forwardWhen do you think a person would opt to use the Payback Period Method instead of the Net Present Value or Internal Rate of Return? Give an example.arrow_forward
- What is the typical discount rate used with the Net Present Value (NPC) when project risk is the same as firm risk?arrow_forwardCan I calculate the Rate of Return using the NPV/initial investment? Why or why not?arrow_forwardWhen comparing multiple mutually exclusive alternatives, select the alternative that __________ the annual worth. a. minimizes b. maximizesarrow_forward
- How do I solve the expected return percent and know if i should buy or sell it?arrow_forwardWhich of the following discounts future cash flows to their present value at the expected rate of return, and compares that to the Initial Investment? A. internal rate of return (IRR) method B. net present value (N PV) C. discounted cash flow model D. future value methodarrow_forwardWhich of the following is not a variable in the basic present value equation? Multiple Choice Number of payments. Future value. Discount rate. Present value. Time horizon.arrow_forward
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