Compare the alternatives below on the basis of their capitalized costs with adjustments made for inflation. Use i=13% per year and f=2.6% per year.AlternativeFirst cost, $Y-15,500,000-12,500,000AOC, $ per yearSalvage value, $Life, years-25,000-10,000105,00082,0001000The capitalized cost for alternative X is $The capitalized cost for alternative Y is $|Select alternative (Click to select) v

Capitalized cost Capitalized cost refers to expenses that are summed to the cost basis of a fixed…

Compare the alternatives below on the basis of their capitalized costs with adjustments made for inflation. Use i=13% per year and f= 2.6% per year. Alternative First cost, $ AOC, $ per year Salvage value, $ Life, years Y -12,500,000 -10,000 82,000 10 -15,500,000 -25,000 105,000 00 The capitalized cost for alternative X is $ The capitalized cost for alternative Y is $[ Select alternative (Click to select)

Compare the alternatives below on the basis of their capitalized costs with adjustments made for inflation. Use i=13% per year and f= 2.6% per year. Alternative First cost, $ AOC, $ per year Salvage value, $ Life, years Y -12,500,000 -10,000 82,000 10 -15,500,000 -25,000 105,000 00 The capitalized cost for alternative X is $ The capitalized cost for alternative Y is $[ Select alternative (Click to select)

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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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

100%

Compare the alternatives below on the basis of their capitalized costs with adjustments made for inflation. Use i=13% per year and f=
2.6% per year.
Alternative
First cost, $
Y
-15,500,000
-12,500,000
AOC, $ per year
Salvage value, $
Life, years
-25,000
-10,000
105,000
82,000
10
00
The capitalized cost for alternative X is $
The capitalized cost for alternative Y is $|
Select alternative (Click to select) v

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Using (incremental) benefit-cost ratio analysis OR (incremental) internal rate of return, determine which of the following three mutually exclusive alternatives should be selected. Each alternative has a 6-year useful life. Assume the MARR is 6%. First Cost Uniform Annual Benefit Salvage Value $560 $140 $40 A $340 $100 0 B $125 $40 0 C
Give typed solution only What is the internal rate of return of a project costing $3,000; having after-tax cash flows of $1,500 in each of the two years of its two-year life; and a salvage value of $800at the end of the second year in addition to the $1,500 cash flow? (rounded to the nearest percentage) A. 13% B. 15% C. 16% D. 19%
Project XYZ has a first cost of $75,000, operating and maintenance costs of $10,000 during each year of its 10 years life, and a $15,000 salvage value. What is its equivalent uniform annual cost (EUAC) if the interest rate is 10%/year? Most nearly number for answer. O No correct answer 21546 O 21262 21622 26223 22126
Compare the alternatives C and D on the basis of a present worth analysis using an interest rate of 10% per year and a study period of 10 years. Alternative C First Cost $-40,000 $-11,000 $-24,000 AOC, per Year Annual Increase in Operating Cost, per Year Salvage Value Life, Years $-2,000 $-200 $-500 $6,000 $200 10 The present worth of alternative C is $ and that of alternative D is $ (Click to select) voffers the lower present worth.
Foc
The equivalent annual worth of alternative A over an infinite time period is closest to:a. $-25,000b. $-27,200c. $-31,600d. $-37,100
The following data pertain to an investment proposal (Ignore income taxes.): Cost of the investment $ 36,000 Annual cost savings $ 11,000 Estimated salvage value $ 4,000 Life of the project 5 years Discount rate 13% Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. The net present value of the proposed investment is closest to: (Round your intermediate calculations and final answer to the nearest whole dollar amount.)
Compare three alternatives on the basis of their capitalized costs at /= 8% per year and select the best alternative. Alternative E F G $-460,000 $-30,000 $90,000 4 First Cost AOC, per Year Salvage Value Life, Years $-80,000 $-65,000 $40,000 2 The capitalized cost of alternative E is $ The best alternative is (Click to select) ▼ alternative F is $ $-960,000 $-3,000 $450,000 ∞0 and alternative G is $
Compare three alternatives on the basis of their capitalized costs at i = 13% per year and select the best alternative. Alternative E F G First Cost $-85,000 $-325,000 $-825,000 AOC, per Year $-65,000 $-20,000 $-6,000 Salvage Value $25,000 $75,000 $500,000 Life, Years 2 4 ∞ The capitalized cost of alternative E is $ , alternative F is $ , and alternative G is $ . The best alternative is E G F .
Harris Corporation has provided the following data concerning an investment project that it is considering: Initial investment Annual cash flow Salvage value at the end of the project Expected life of the project Discount rate $ 160,000 $ 54,000 $ 11,000 O $67,000 O $160,516 O $516 O $(5,776) 4 15 per year years % Use Exhibit 7B-1 and Exhibit 7B-2, to determine the appropriate discount factor(s) using the tables provided. The net present value of the project is closest to:
Consider the following alternatives below.Based on a 7% interest rate, assuming both alternatives perform the same task and there is a continuing requirement, which alternative should be selected and what is its equivalent uniform annual cost?
You Answered Some particulars for a project are as follows. Initial Capital Cost in year 0 ($Mn) Follow-up 'one-off' cost in year 1 ($Mn) Annual Operating Cost ($Mn/yr) Annual Benefits ($Mn/yr) Correct Answers Project Closure Cost, at end of project life ($Mn) Useful Life (years) Interest/Discount rate (percent) 1000 300 10% of capital cost 400 2,391 (with margin: 5) 200 20 7 What is the Life Cycle Cost of the project - expressed in present value term? (your answer must be rounded off to the nearest million dollars, i.e., no decimal places)

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