10.Consider the two one-shot investment alternatives shown in the table below. Neither alternative is expected to beavailable again in the future, but it is expected that investment options returning MARR will always be availableEOY12367Alternative W-$100,000$50,000$80,000$20,000$20,000$110,000Alternative X-$150,000$60,000$40,000$45,000$50,000$55,000$65,000$70,000Determine the following.What is the length of the planning horizon?а.What measure of worth is preferred?b.What measure of worth should be avoided?с.Which alternative is preferred if MARR is 8 percent?d.

a.For one-shot investment alternatives, the length of the planning horizon is based on the longest…

Answered: 10. Consider the two one-shot…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

A. 6.36 The four alternatives described below are being evaluated. This question has three parts Part 2: If the proposals are mutually exclusive, which one should be selected at a MARR of 14.5% per year? Incremental Rate of Return, %, When Compared with Alternative Overall Initial Alternative Rate of A Investment, $ Return, % -60,000 11.7 -90,000 22.2 43.3 C -140,000 17.9 22.5 10.0 D -190,000 15.8 17.8 10.0 10.0 O B O A O C OD
I need solution with explanation please,
Question 1: Salalalh Methanol company management is considering three competing investment Projects A, B & C_ Year Initial Investment 1 Project A Project B Project C 12000 12000 12000 1200 3100 4150 5260 5225 8250 3800 7360 9275 9300 4 4600 9460 Assume a discount Rate of 5.45 % Use the information above and help the management in choosing the most desirable Project using Payback period, Discounted payback Net Present value and Profitability Index. Out of the four methods which is considered to be the most desirable. Explain
"Consider the following two mutually-exclusive alternatives: Project Alternatives n Project A1 Cash Flows Project A2 Cash Flows $14,000 -$17,000 +$21,000 1 + $4,000 2+ $4,000 +$12,000 If MARR=15% and assuming indefinite required service and repeatability, use the incremental NPV and IRR analyses in parts (a) and (b) of the problem, respectively, to choose the project in part (c). Please note that project alternatives A1 and A2 have different lives, namely three years for A1 and one year for A2. The alternatives should be compared over the same period, so project A2 will have to be repeated twice." (a) The Net Present Value of the incremental investment is: (b) The Internal Rate of Return of the incremental investment is: (c) We should choose project alternative: + Note: Please enter your answers to two decimal places. If using the interest factor method, apply the value of the factor as presented in the table or spreadsheet (with all four decimal places).
Qd 21.
Can I please have the answers in these format : payback period = investement net annual inflow ARR = Average annual profit x 100 Average investment 1 can I have the answers in these type of format
None
• You, a project manager, are in the middle of choosing between two different projects with the following cash flows: Time period 0 1 2 3 4 Project A $(60,000) $5,000 $10,000 $10,000 $75,000 Project B $(60,000) $50,000 $30,000 $10,000 $10,000 • Determine which project you should act on using NPV with an interest rate of 12%.
Whispering Inc. now has the following two projects available: Project Initial CF After-tax CF1 After-tax CF2 1 2 PMT1 PMT2 $ $ -11,634.42 Project 1 -3,290.48 5,300 3,800 Assume that RF = 5.1 percent, risk premium = 10.6 percent, and beta = 1.2. Use the EANPV approach to determine which project Whispering Inc. should choose if they are mutually exclusive. (Round cost of capital and final answers to 2 decimal places, e.g.17.35% or 2,513.25.) 1673.12 1479.74 6,200 should be chosen. 3,200 After-tax CF3 9,600
Two mutually exclusive alternatives A and B are being considered: Year A 1 A 2 0 1 -$2500 $746 -$6000 $1664 2 3 4 5 $746 $746 $746 $746 $1664 $1664 $1664 $1664 The minimum attractive rate of return is 8%. After calculation we can find that the internal rates of return: for A 1, IRRA1 = 17%, for B, IRRA2 = 14% and for A 2-A 1, IRRA2-A1 = 9.8%. Which of the following statements is correct? Select A 1 because IRRA 1 > IRRA 2 Select neither A 1 nor A 2 because IRRA 1 > MARR and IRRA 2 > MARR Select A 1 because IRRA 2-A 1 > MARR select A 2 because IRR 2-1 > MARR
Compute the Payback statistic for Project X and recommend whether the firm should accept or reject the project with the cash flows shown below if the appropriate cost of capital is 10 percent and the maximum allowable payback is 4 years. Time: 0 1 Cash flow: -2,300 250 Multiple Choice 2.75 years, Reject 3.75 years, Accept 3.75 years, Reject 2.75 years, Accept 2 550 3 900 4 800 5 575

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS