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3. A man is considering investing P500,000 to open a semi-automatic auto-washing machine business in a city of 400,000 population. The equipment can wash, on the average, 12 cars per hour, using two men to operate it and to do small amount of hand work. The man plans to hire two men, in addition to himself, and operate the station on an 8-hour basis, 6 days per week, 50 weeks per year. He will pay his employees P15.00 per hour. He expects to charge P22.00 for a car wash. Out-of-pocket miscellaneous cost would be P8,500 per month. He would pay his employees for 2 weeks for vacations each year. Because of the length of his lea investment within 5 years. His capital now is earning 15%, and he is employed at a steady job that pays P20,000 per month. He desires a rate of return of at least 20% on his investment. Would you recommend the investment? he must write off his

3. A man is considering investing P500,000 to open a semi-automatic auto-washing machine business in a city of 400,000 population. The equipment can wash, on the average, 12 cars per hour, using two men to operate it and to do small amount of hand work. The man plans to hire two men, in addition to himself, and operate the station on an 8-hour basis, 6 days per week, 50 weeks per year. He will pay his employees P15.00 per hour. He expects to charge P22.00 for a car wash. Out-of-pocket miscellaneous cost would be P8,500 per month. He would pay his employees for 2 weeks for vacations each year. Because of the length of his lea investment within 5 years. His capital now is earning 15%, and he is employed at a steady job that pays P20,000 per month. He desires a rate of return of at least 20% on his investment. Would you recommend the investment? he must write off his

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
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3. A man is considering investing P500,000 to open a semi-automatic auto-washing machine business in a city of 400,000 population. The equipment can wash, on the average, 12 cars per hour, using two men to operate it and to do small amount of hand work. The man plans to hire two men, in addition to himself, and operate the station on an 8-hour basis, 6 days per week, 50 weeks per year. He will pay his employees P15.00 per hour. He expects to charge P22.00 for a car wash. Out-of-pocket miscellaneous cost would be P8,500 per month. He would pay his employees for 2 weeks for vacations each year. Because of the length of his lea investment within 5 years. His capital now is earning 15%, and he is employed at a steady job that pays P20,000 per month. He desires a rate of return of at least 20% on his investment. Would you recommend the investment? he must write off his
Transcribed Image Text:3. A man is considering investing P500,000 to open a semi-automatic auto-washing machine business in a city of 400,000 population. The equipment can wash, on the average, 12 cars per hour, using two men to operate it and to do small amount of hand work. The man plans to hire two men, in addition to himself, and operate the station on an 8-hour basis, 6 days per week, 50 weeks per year. He will pay his employees P15.00 per hour. He expects to charge P22.00 for a car wash. Out-of-pocket miscellaneous cost would be P8,500 per month. He would pay his employees for 2 weeks for vacations each year. Because of the length of his lea investment within 5 years. His capital now is earning 15%, and he is employed at a steady job that pays P20,000 per month. He desires a rate of return of at least 20% on his investment. Would you recommend the investment? he must write off his
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