on 6 (B/C Analysis):  A) Construction Project You are planning to invest your money in a new project that will have a first cost of $1 million and an annual maintenance cost of $50,000 per year. The income of the project is expected to be $300,000 per year. The project will have an 10-year life. At an interest rate of 10% per year compounded, should the project be undertaken (Perform B/C Analysis)? B /C =      B )Alternative Investment If there is another option which, is you invest the same amount (1,000,000) in an investment company that gives 3% per year rate of return, The investment will will be for 10-year . How much the investment company will give e

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Question 6 (B/C Analysis): 

A) Construction Project

You are planning to invest your money in a new project that will have a first cost of $1 million and an annual maintenance cost of $50,000 per year.

The income of the project is expected to be $300,000 per year.

The project will have an 10-year life.

At an interest rate of 10% per year compounded, should the project be undertaken (Perform B/C Analysis)?

B /C = 

 

 

B )Alternative Investment

If there is another option which, is you invest the same amount (1,000,000) in an investment company that gives 3% per year rate of return,

The investment will will be for 10-year .

How much the investment company will give every year? 

Which option would be better?

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