6) What is the Equivalent Annual Cost (EAC) for each of the two options for which the annualcash flows are listed below? (Note: when calculating EAC, you should treat negative cashflows as positive values, and positive cash flows as negative values.) Use i=5%.YearOption 1Option 2-$25,000-$50,0001-$3,000-$7,000-$7,000-$7,0002-$3,0003-$6,0004-$6,000-$8,000-$6,000-$8,000-$8,000-$9,000-$9,000-$9,000-$9,000-$9,0008-$9,0009-$9,00010$5,000$9,000

Answered: 6) What is the Equivalent Annual Cost…

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

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6. Consider the following cash flow series, Aj=1,500 A2=3,000 A3=4,500 A4-6,000 As=7,500 A6=9,000 A=10,500 Ag=12,000 A9=13,500 A10=15,000 and Au=16,500 a. Determine the present worth and the future worth based on an interest rate of 15%. b. Determine the equivalent annual cost for the given cash flow series.
3. The cash flows for three different alternatives are given in table below. If MARR is set at 8%, use incremental analysis between (Y and Z), (Y and X) to determine which is the best alternative? Data Alt. X Alt. Y Alt. Z Initial Cost, S Net Benefits/ Year, S 528 Life, Years 12,500 7,500 1,063 25 9,000 510 25 25
A project has the following cash flows set out below. What is the profitability index of this project if the relevant discount rate is 2 percent? Enter your final answer to two decimal places. Year Cash flow 0 -1,745 1 537 2 2,066 3 3,912
Determine the present value of the following single amounts. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1. PV of $1. EVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) 1. 2. 3. 4. Future Amount $ 28,000 22,000 33,000 48,000 $ $ 9% 10% 12% 11% n= 14 17 28 13 Present Value
Please help me with show all calculation thanku
Calculate the HPR of the following investment, entered as a percentage (Example: if your answer is 14.5%, enter 14.5 and not 0.145) Period Cashflow 0 -14100 1 3300 2 3300 3 3100 4 2800
Q2 given below. Discount rate Year Costs . Refer to the formula given in the previous problem, complete the required data in the table 8% Benefits Cashflow Discount factor Present Net Value (NPV) Discounted costs ANSWER 0 140,000 O 40,000 200,000 160,000 Return on Investment (Rol) 2 40,000 200,000 160,000 Total
Determine the present value of the following single amounts. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Future Amount ¡ = n = Present Value 1. $ 23,000 4% 15 2. $ 17,000 8% 12 3. $ 28,000 12% 24 4. $ 43,000 10% 8
Average Rate of Return Method, Net Present Value Method, and Analysis for a service company The capital investment committee of Arches Landscaping Company is considering two capital investments. The estimated operating income and net cash flows from each investment are as follows: Front-End Loader Year 1 2 3 4 5 Total Year 1 2 3 4 5 6 7 Operating Income 8 9 10 $54,000 54,000 54,000 54,000 54,000 $270,000 0.943 Each project requires an investment of $600,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 10% for purposes of the net present value analysis. Present Value of $1 at Compound Interest 6% 0.890 0.840 0.792 0.747 0.705 0.665 0.627 0.592 0.558 10% Net Cash Flow 0.909 0.826 0.751 $172,000 172,000 172,000 172,000 172,000 $860,000 12% 0.893 0.797 0.756 0.712 0.658 0.683 0.636 0.572 0.621 0.567 0.497 0.564 0.507 0.513 0.467 0.424 0.386 0.452 0.404 15% 0.361 0.322 0.870 0.432 0.376 0.327 0.284 0.247 Operating Income…
N2. Account
Calculate the APR of the following investment, entered as a percentage (Example: if your answer is 14.5%, enter 14.5 and not 0.145) Year Number Cashflow 0 -11000 1 3000 2 3500 3 2900 4 2800
Determine the future value of the following single amounts. Note: Use tables, Excel, or a financial calculator. Round your final answers to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Invested Amount i- n Future Value 1. $ 11,500 7% 15 23 $ 15,000 6% 14 $ 28,000 12% 14 4. S 48,000 8% 6

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