Iskandar Malaysia in Johor is planning to introduce a new set of public transit system. Thus, if the vehicle operating costs is RM 0.10/km, travellers value their time at RM 3.00/hour, and the average cost of a traffic accident is RM 25,000, what is the benefit-cost ratio? Assume an interest rate of 9% per annum.

Iskandar Malaysia in Johor is planning to introduce a new set of public transit system. Thus, if the vehicle operating costs is RM 0.10/km, travellers value their time at RM 3.00/hour, and the average cost of a traffic accident is RM 25,000, what is the benefit-cost ratio? Assume an interest rate of 9% per annum.

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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Co. has an investment opportunity (Project B) that requires a cash outlay of $18,000 today. They estimate that they will receive in exchange $6,200 in year 1, $6,500 in year 2, and $8,200 in year 3. Our Co 10. Marvelous me a) What are the IRR and the NPV of Project B? b) If the discount rate is 10%, would you invest in Project B? c) Let's imagine that we had a second project (Project B) that has an IRR of 18%. If the crossover rate between these two projects is 13%, which project would you choose when the appropriate discount rate is below that crossover rate?
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The Klingon Sausage Corporation is trying to choose between the following two projects: Year Cash Flow (Project I) Cash Flow (Project II) 0 -$363,000 -$165,000 1 184,800 99,600 2 184,800 99,600 3 184,800 99,600 The discount rate of both projects is 8%. Klingon’s manager believes the company has sufficient resources so that the two projects should not be treated as mutually exclusive. Which project should be taken based on the profitability index? A. Project I should be accepted and project II should be rejected. B. None of the projects should be accepted. C. Project I should be rejected and project II should be accepted. D. Both projects should be accepted.
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ou are preparing to produce some goods for sale. You will sell them in one year and you will incur costs of $ 76,000 immediately. If your cost of capital is 7%. What is the minimum dollar amount you need to sell the goods for in order for this to be a non-negative NPV? Question content area bottom Part 1 The minimum dollar amount is $XXX enter your response here .
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