Four projects (A, B, C, D) are evaluated for five years in a company that adopts MARR=10%. The evaluation data are as follows: PW of A at MARR=10% is $50,000. FW of B at MARR=10% is $60,000. IRR of C is 12%. IRR of D is 9%. Based on the data above, which statement is correct? O a. Cis better than D, but it is not better than A O b. A is better than B and D O. Bis better than A, but we don't know if it is better than C O d. All projects are feasible

Four projects (A, B, C, D) are evaluated for five years in a company that adopts MARR=10%. The evaluation data are as follows: PW of A at MARR=10% is $50,000. FW of B at MARR=10% is $60,000. IRR of C is 12%. IRR of D is 9%. Based on the data above, which statement is correct? O a. Cis better than D, but it is not better than A O b. A is better than B and D O. Bis better than A, but we don't know if it is better than C O d. All projects are feasible

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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Three mutually exclusive projects, A, B, and C, each require $100,000, S62,500, and $75,000 initial investment. They generate annual income of $20,000, $8,750, and $13,750, respectively for 10 years. At MARR=10% per year, use IRR to choose the best project.
The Flynn manufacturing company is undergoing a review by the board of regents for expounding their performance. Three proposals were under strict scrutiny given its investment and corresponding cash flow. If the company desires an MARR=15% for the period 5 years, which from the following proposal will be beneficial for Flynn company? End of year Proposal A Proposal B Proposal C -135000 -160000 -200000 1 24000 43000 60000 24000 43000 60000 24000 43000 60000 4. 24000 43000 60000 24000 43000 60000 Calculate using Benefit-Cost Ratio Method. 3.
GeoWorld Systems uses a subset of the following questions during the interview process for new engineers. For each of the following cases, determine if “the project” or “do nothing” is preferred. The value of MARR in each case is 14%.
Please answer ASAP if you can please. Thank you! Please Please write expression or formula used Set up expression initially with functional notation (e.g.,(P/F,I,n))
Please answer ASAP if you can please. Thank you! Please Please write expression or formula used Set up expression initially with functional notation (e.g.,(P/F,I,n))
7 independent project proposals from various departments of an enterprise has come. The budget allocated by the management for these projects is 600,000 TL. Current value identify the appropriate projects using the method. (I = 20% will be accepted and the first take p=0.2 for trial. ) Scrap Value (Thousand (Thousand TL) Cost Annual Smooth Useful Project TL) earnings (thousand TL) lifetime (year) 1 200 60 10 100 35 10 3 100 30 10 4 150 46 8. 250 75 10 10 6. 100 45 7 50 19 8.
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals the study period the ior from least capital investment to greatest capital investment is Do nothing A C. B.Complete the IRR analysis by selecting the preferred Do nothing vs A A vs C A vs B Capital investment -$15,000 -%$2,000 -$3,000 O aB Annual Revenues $4,000 $900 $460 Annual costs -S1,000 Ob. Do nothing -S160 $100 Morket value $6.000 -%$2,200 $3,350 Occ RR 12.7% 10.9% OdA
Determine if the selection of system 1 or 2 is sensitive to variation in the return required by management. The corporate MARR ranges from 8% to16% per year on different projects. Use tabulated factors or a spreadsheet, as requested by your instructor.
Determine the average rate of return for a project that is estimated to yield total income of $460,320 over 3 years, has a cost of $964,500, and has a $131,500 residual value. Round to the nearest whole number. fill in the blank 1 of 1%
A company is planning to install a new automated plastic-moulding press. Four different presses are available. The initial capital investments and annual expenses for these four mutually exclusive alternatives are as follows: Assume that each press has the same output capacity and has no market value at the end of its useful life; the selected analysis period is five years. Which press should be chosen? Use MARR = 20% per year.
A recent engineering graduate decided to begin an investment program at the age of 23, with the hope of achieving an investment goal of $5 million by age 58. If a gradient series describes the engineer’s investment pattern over the 35- year period and if the annual return on the engineer’s investments is approximately 6.5%, what gradient step is required to achieve the goal if the first of the 36 investments equals $5,000?
Hawk, Inc. has a 15% required rate of return. Three divisions of Hawk have proposed three projects to increase income over the next 12 years. Three divisions report different measures as follows: Project A was reported to have an NPV of ($530) or negative $530. Project was reported with an internal rate of return of 18%. Project C was reported to have a payback period of 15 years. With which of these projects should Hawk move forward? O All three sound great! O Project A O Project C O Project B

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