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Bau Long-Haul, Incorporated, is considering the purchase of a tractor-trailer that would cost $358,263, would have a useful life of 7 years, and would have no salvage value. The tractor-trailer would be used in the company's hauling business, resulting in additional net cash inflows of $81,000 per year. The internal rate of return on the investment in the tractor-trailer is closest to (Ignore income taxes.): Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. Multiple Choice 13% 12% 15%

Bau Long-Haul, Incorporated, is considering the purchase of a tractor-trailer that would cost $358,263, would have a useful life of 7 years, and would have no salvage value. The tractor-trailer would be used in the company's hauling business, resulting in additional net cash inflows of $81,000 per year. The internal rate of return on the investment in the tractor-trailer is closest to (Ignore income taxes.): Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. Multiple Choice 13% 12% 15%

Essentials Of Investments
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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Bau Long-Haul, Incorporated, is considering the purchase of a tractor-trailer that would cost $358,263, would have a useful life of 7 years, and would have no salvage value. The tractor-trailer would be used in the company's hauling business, resulting in additional net cash inflows of $81,000 per year. The internal rate of return on the investment in the tractor-trailer is closest to (Ignore income taxes.): Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. 02 Multiple Choice 13% 12% 15% < Prev 2 of 5 Next > 9:25 a 4/25/2 here to search acer 近
Transcribed Image Text:Bau Long-Haul, Incorporated, is considering the purchase of a tractor-trailer that would cost $358,263, would have a useful life of 7 years, and would have no salvage value. The tractor-trailer would be used in the company's hauling business, resulting in additional net cash inflows of $81,000 per year. The internal rate of return on the investment in the tractor-trailer is closest to (Ignore income taxes.): Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. 02 Multiple Choice 13% 12% 15% < Prev 2 of 5 Next > 9:25 a 4/25/2 here to search acer 近
EXHIBIT 14B-1 1. Present Value of $1; (1+r)" Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 16% 0.962 0.952 0.943 0.9350.926 0.917 0.909 0.901| 0.893 0.885 0.877 0.870 0.862 15% 17% 18% 19% 20% 21% 22% 23% 24% 25% 1 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 2 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.7830.769 0.756 0.743 0.731 0.718 0.706 0.694 0.683 0.672 0.661 0.650 0.640 3 0.889 0.864 | 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.675 0.658 0.624 0.609 0.593 0.579 0.564 0.551 0.641 | 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.537 0.524 0,512 4 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 0.713 0.681 0.650 0.621 0.593 0.567 0.543 0,519 0.497 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0328 0.666 0.855 0.823 0.792 0.822 0.784 0.747 0.437 0.4230.410 0.790 0.746 0.705 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.583 0.547 0.513 0.482 0.452 0.425 0.400 0.376 0,540 0.502 0.467 0.434 0.410 0.390 0.354 0.333 0.314 0.296 0.279 0.263 0.305 0.285 0.370 0.352 0.335 0.319 0.289 0.275 0.262 0.303 0 0.249 0.235 0.222 0.210 0.204 0.191 0.167 0.155 0.144 0.711 | 0.665 0.731 0.703 0.676 0.614 0.650 0.585 0.527 0.627 0.582 0.645 0.592 0.544 0.500 0.558 0.508 0.463 0.677 0.467 0.434 0.404 0.376 0.351 0.327 0.308 0.284 0.266 0.249 | 0.233 | 0.218 0.179 | 0.168 9 0.460 0.424 0.391 0.361 0.422 0.386 0.352 0.322 0.295 0.270 0.317 0.287 0.261 0.237 0.263 0.243 0.225 0.209 0.194 0.227 0.208 0.191 0.176 0.162 0.195 0.178 0.162 0.148 0.180 0.134 10 0.247 0.215 0.187 0.229 0.204 0.182 0.163 0.145 0.130 0.116 0.141 0.162 0.137 0.149 0.135 0.123 0.112 0.107 0.094 0.086 0.076 | 0.069 0.068 0.061 0.055 0.055 0.049 0.044 0.126 0.116 11 0.475 0.388 0.350 0.429 0.135 0,103 0.557 0.497 0.444 0.397 0.356 0.368 0.326 12 0.625 0.319 0.286 | 0.257 0.231 | 0.208 0.168 0.152 0.137 0.124 0.102 | 0.092 0.084 0.075 0.062 0.083 0.601 0.5300.469 0.415 0.577 0.505 0.555 0.534 0.458 13 0.104 0.093 0.078 0.065 0.054 0.442 0.388 0.340 0.362 14 0.232 0.205 0.181 0.160 0.183 0.160 0.140 0.299 0.263 0.275 0.239 0.125 0.108 0.111 0.099 0.088 0.069 15 0.481 0.315 0.339 0.292 0.252 0.218 0.371| 0.317 0.270 | 0.231 0.198 0.417 0.074 0.095 0.081 0.209 0.084 0.123 0.141 0.123 0.107 0.057 0.051 0.045 0.040 0.035 16 0.394 0.163 0.170 0.146 0.153 0.130 0.138 0.188 0.093 0.071 0.062 0.047 0.042 0.036 0.032 0.028 17 0.513 0.436 0.125 0.108 0.080 0.069 0.060 0.052 | 0.045 0.039 0.034 0.030 0.026 0.023 0.024 0.021 0.018 0.017 0.093 0.494 0.416 0.350 0.296 0.250 | 0.212 0.180 0.475 0.396 F0.456 0.095 0.083 0.073 0.061 0.093 0.077 0.064 0.053 0.068 0056 0.046 0.038 0.037 | 0.031 0.031 0.026 0.022 0.022 | 0.018 0.018 0.015 18 0.111 0.059 0.051 0.044 0.032 | 0.028 0.027 0.023 0.081 0.069 19 0.331 0.277 0.232 0.194 0.164 0.116 0.098 0.060 0.051 0.044 0.037 0.031 0.038 0.033 0.051 0.043 0.043 0.037 0.070 0.020 0.014 20 0.377 0.215 0.178 0.149 0.087 0.312 0.294 0.258 0.124 0.104 0.016 | 0.014 0.012 0.013 0.0110.009 0.019 0.439 0.422 0.359 0.342 0.135 0.112 0.123 0.101 21 0.242 0.199 0.164 0.026 0.015 0.226 0.184 0.083 0.032 0.026 0.022 0.027 0.022 22 0.278 0.150 0.013 0.011 0.009 0.007 0.406 0.326 0.262 0.211 0.170 0.138 0.390 0.375 23 0.060 0.049 0.040 0.018 0.0115 0.112 0.091 0.102 0.082 0.066 0.074 0.009 0.007 0.006 0.006 0.006 0 005 0.005 | 0.004 0.012 0.007 0.010 0.008 0.007 24 0.310 0.247 0.197 0.158 0.126 0.053 0.043 0.035 0.028 0.023 0.019 0.015 0.013 0.010 0.295 0.233 0.184 0.146 0.116 0.092 0.074 0.059 0.047 0.038 0.030 0.024 0.020 0.016 0.013: 0.010 0.009 O201 0.230 0173 25 0201 001 9:24 AM a A O 40 4/25/2021
Transcribed Image Text:EXHIBIT 14B-1 1. Present Value of $1; (1+r)" Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 16% 0.962 0.952 0.943 0.9350.926 0.917 0.909 0.901| 0.893 0.885 0.877 0.870 0.862 15% 17% 18% 19% 20% 21% 22% 23% 24% 25% 1 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 2 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.7830.769 0.756 0.743 0.731 0.718 0.706 0.694 0.683 0.672 0.661 0.650 0.640 3 0.889 0.864 | 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.675 0.658 0.624 0.609 0.593 0.579 0.564 0.551 0.641 | 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.537 0.524 0,512 4 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 0.713 0.681 0.650 0.621 0.593 0.567 0.543 0,519 0.497 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0328 0.666 0.855 0.823 0.792 0.822 0.784 0.747 0.437 0.4230.410 0.790 0.746 0.705 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.583 0.547 0.513 0.482 0.452 0.425 0.400 0.376 0,540 0.502 0.467 0.434 0.410 0.390 0.354 0.333 0.314 0.296 0.279 0.263 0.305 0.285 0.370 0.352 0.335 0.319 0.289 0.275 0.262 0.303 0 0.249 0.235 0.222 0.210 0.204 0.191 0.167 0.155 0.144 0.711 | 0.665 0.731 0.703 0.676 0.614 0.650 0.585 0.527 0.627 0.582 0.645 0.592 0.544 0.500 0.558 0.508 0.463 0.677 0.467 0.434 0.404 0.376 0.351 0.327 0.308 0.284 0.266 0.249 | 0.233 | 0.218 0.179 | 0.168 9 0.460 0.424 0.391 0.361 0.422 0.386 0.352 0.322 0.295 0.270 0.317 0.287 0.261 0.237 0.263 0.243 0.225 0.209 0.194 0.227 0.208 0.191 0.176 0.162 0.195 0.178 0.162 0.148 0.180 0.134 10 0.247 0.215 0.187 0.229 0.204 0.182 0.163 0.145 0.130 0.116 0.141 0.162 0.137 0.149 0.135 0.123 0.112 0.107 0.094 0.086 0.076 | 0.069 0.068 0.061 0.055 0.055 0.049 0.044 0.126 0.116 11 0.475 0.388 0.350 0.429 0.135 0,103 0.557 0.497 0.444 0.397 0.356 0.368 0.326 12 0.625 0.319 0.286 | 0.257 0.231 | 0.208 0.168 0.152 0.137 0.124 0.102 | 0.092 0.084 0.075 0.062 0.083 0.601 0.5300.469 0.415 0.577 0.505 0.555 0.534 0.458 13 0.104 0.093 0.078 0.065 0.054 0.442 0.388 0.340 0.362 14 0.232 0.205 0.181 0.160 0.183 0.160 0.140 0.299 0.263 0.275 0.239 0.125 0.108 0.111 0.099 0.088 0.069 15 0.481 0.315 0.339 0.292 0.252 0.218 0.371| 0.317 0.270 | 0.231 0.198 0.417 0.074 0.095 0.081 0.209 0.084 0.123 0.141 0.123 0.107 0.057 0.051 0.045 0.040 0.035 16 0.394 0.163 0.170 0.146 0.153 0.130 0.138 0.188 0.093 0.071 0.062 0.047 0.042 0.036 0.032 0.028 17 0.513 0.436 0.125 0.108 0.080 0.069 0.060 0.052 | 0.045 0.039 0.034 0.030 0.026 0.023 0.024 0.021 0.018 0.017 0.093 0.494 0.416 0.350 0.296 0.250 | 0.212 0.180 0.475 0.396 F0.456 0.095 0.083 0.073 0.061 0.093 0.077 0.064 0.053 0.068 0056 0.046 0.038 0.037 | 0.031 0.031 0.026 0.022 0.022 | 0.018 0.018 0.015 18 0.111 0.059 0.051 0.044 0.032 | 0.028 0.027 0.023 0.081 0.069 19 0.331 0.277 0.232 0.194 0.164 0.116 0.098 0.060 0.051 0.044 0.037 0.031 0.038 0.033 0.051 0.043 0.043 0.037 0.070 0.020 0.014 20 0.377 0.215 0.178 0.149 0.087 0.312 0.294 0.258 0.124 0.104 0.016 | 0.014 0.012 0.013 0.0110.009 0.019 0.439 0.422 0.359 0.342 0.135 0.112 0.123 0.101 21 0.242 0.199 0.164 0.026 0.015 0.226 0.184 0.083 0.032 0.026 0.022 0.027 0.022 22 0.278 0.150 0.013 0.011 0.009 0.007 0.406 0.326 0.262 0.211 0.170 0.138 0.390 0.375 23 0.060 0.049 0.040 0.018 0.0115 0.112 0.091 0.102 0.082 0.066 0.074 0.009 0.007 0.006 0.006 0.006 0 005 0.005 | 0.004 0.012 0.007 0.010 0.008 0.007 24 0.310 0.247 0.197 0.158 0.126 0.053 0.043 0.035 0.028 0.023 0.019 0.015 0.013 0.010 0.295 0.233 0.184 0.146 0.116 0.092 0.074 0.059 0.047 0.038 0.030 0.024 0.020 0.016 0.013: 0.010 0.009 O201 0.230 0173 25 0201 001 9:24 AM a A O 40 4/25/2021
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