Sam invested a total of $100,000 into a project, and his total profits to date sum up to $120,000. What is the return on investment? 0.25 0.15 0.30 0.20
Q: You are a financial analyst for the ABC Company. The director of capital budgeting has asked you to…
A: Time Cash Flow Discounted Cash Flow Accumulated Discounted Cash Flow 0 -7000 1 5500 2…
Q: Branch B: One of the investors wanted to buy a factory for the production of electrical…
A: japan korea tfc 1000000 800000 tvc 500000 700000 tc 1500000 1500000 ac 15 15
Q: You are considering building a small house for rent as an investment. The land costs $9,000, the…
A: Considering building a small house for rent as an investment. The project has a 10-year lifespan,…
Q: A motor vehicle
A: The diminishing return is also known as the law of diminishing returns. It states that an increase…
Q: You are trying to determine the financial break-even (as we defined in class) market size for the…
A: Financial break-even cash flow is a point at which the cash inflows are equal to cash outflows. This…
Q: Input MPP is the additional output that results from a one-unit increase in use of the input. a.…
A: Marginal physical product (MPP) measures the change in total output resulting from one-unit change…
Q: A project has an expected return on investment of 7% and the firm’s hurdle rate is 5%. Explain why…
A: A hurdle rate, usually described as a minimum acceptable rate of return or MARR, is the minimum…
Q: A project has a net present value of zero, what return is earned on this project when the discount…
A: The net present worth or net present worth applies to a progression of incomes happening at various…
Q: Topic: ENVIRONMENT OF THE FIRM AND OPTIMIZATION TECHNIQUES (Managerial Economics) As a manager of…
A: The present value , also known as present discounted value, conveys the current value of future…
Q: State true/False # When there is diminishing returns to a factor, the value of both MP and TP falls
A: # The third phase of variable proportion is the DIMINISHING returns to factor. This phase is due to…
Q: The internal rate of return on some project is defined as the rate of interest that a. makes the NPV…
A: The answer is - a. Makes the NPV of the project equal to zero.
Q: I was told that the NPV alpha and IRR alpha is correct. but I was also told that project alpha has a…
A: Given that;Project Alpha: has initial outlay of $10,000Cash flow after 2 years is $12,000Project…
Q: suppose that you invest $40,000 in a restaurant business. One year later, you sell half of this…
A:
Q: Describe the net future worth of the project?
A: Future value (FV) is the value of an existing asset at a future date, based on an assumed growth…
Q: In this problem, we consider replacing an existing electrical water heater with an array of solar…
A: The simple payback period (PBP) is the time when the asset's cumulative net cash flow becomes…
Q: When deciding upon the optimal amount of capital, a firm will decide to purchase additional capital…
A: This question is about the concept of optimal capital structure. The optimal capital structure of a…
Q: Tim Smunt has been asked to evaluate two machines. After some investigation, he determines that they…
A: The net present value or net present worth applies to a series of cash flows occurring at different…
Q: CLP is planning to go into the designer jeans business. They project the following costs for the…
A: Break-even Analysis:Fixed Costs: Rental payments ($18,000), Overhead ($48,750), Interest on Capital…
Q: SCG makes wall units. For the year, the following details have been budgeted. Output, 10,000 units;…
A:
Q: emitting (LED) light req years, make financial sense? Suppose a typical 60-watt incandescent light…
A: Assume, Break-even cost is C.Equated annua l cost function of 60watt bu lb…
Q: a) What is the NPV of each project? Which projects should Xia undertake, and how much cash should it…
A: Answers (A) Calculation of Net present value of all three projects A, B and C NPVA = -20000 +…
Q: Here is a breakdown of Joe's Garage who usually repairs up to 100 cars a month: ATC = $200, AVC =…
A: Given: ATC=$200AVC=$150MC=$100
Q: Assume you are managing a one-year project and have listed the project earned management value as…
A: Cost variance = Earned value - Actual value = $22,000- $$27,000 = -$5000 As cost variance is…
Q: Firms invest a fixed amount of 200 per year. As they forecast that the economic conditions are going…
A: What Is the Economic Situation? The current state of the economy in a particular country or region…
Q: Fixed costs are irrelevant in decisions about whether a product should be retained or be dropped.…
A: 22. The required rate of return is the maximum rate of return that an investment project yield be…
Q: State if the given statement is True/False As soom as MC starts rising, AVC also starts rising.
A: Marginal cost refers to the additional cost of producing the extra unit of output, while average…
Q: If an investment has an estimated cost of £1000, and it offers £550 the first and the second year…
A: The internal rate of return (IRR) is the interest rate that makes the net present value (NPV) zero.…
Q: aken an industrial design course at Dubai Men's College to help prepare for this venture. The course…
A: Fixed cost = Small factory rent + Utility + Equipment rent + Advertising cost Fixed cost…
Q: 9. A company is considering a £70,000 investment in a machine that would produce 10,000 items per…
A: Sensitivity Analysis refers to the financial theory that discusses how changes in certain input…
Q: An investment project provides cash inflows of $76 Calculating Payback per year for eight years.…
A: Payback Period - the payback time frame is the time allotment it would take for the future incomes…
Q: You have an opportunity to invest $49,300 now in return for 500,500 in one year if your cost of…
A: If $49,300 is invested today, then we will receive $60,500 after one year. Also, the cost of capital…
Q: Find value of output if sales is $450 amd change in stock is $350
A: According to question we are given that Sales =$450 change in Stock = $350 value of output =?
Q: If you invest $10,000 now into a project that will yield net revenues of $1,327 at the end of each…
A: IRR is calculated using excel as follows: Ms Excel -formula-Irr
Q: What is Residual income for Galaxy Company if operating income for the period is $125,000, average…
A: Residual income is income that one continues to receive after the completion of the income-producing…
Q: for the past year. At the beginning of the year the company had $208,000 in assets and $58,000 in…
A: The return on assets shows the percentage of how profitable a company's assets are in generating…
Q: 4. If the project's cost of capital is 12%, what is the NPV of the project? $ 209,845
A: A financial metric called Net Present Value (NPV) is used to determine if an investment or project…
Q: Which of the following would not be on the statement of cash flows? Group of answer choices Cash…
A: Cash flow statement: It is the financial statement that indicates the cash coming in and going out…
Q: Compute the (i) net present value and (ii) internal rate of return of the following Q2. capital…
A: Let's first calculate NPV:- For A:- NPV = -50000(1+15%)0+10000(1+15%)1+30000(1+15%)2+25000(1+15%)3…
Q: The common stock of Eddie's Engines, Inc. sells for $15.75 a share. The stock is expected to pay…
A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…
Q: (a) Derive the IS curve assuming the following consumption and investment functions: C(Y-T) = 200+…
A: introduction IS curve is the combination of different interest rates and income so that the product…
Q: a. At a required return of 12 percent, what is the NPV of the project? (Do not round intermediate…
A: All cash flows are discounted with an appropriate discounting rate to arrive at their present value,…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- The Rosebud Motel is a must-stay for any road-tripper or weary traveler. The motel fils each of its 24 rooms for 200 nights each during the year. Annual fixed costs total $160,000. The variable cost of one night's stay is $100. The motel owners expect a 50% return on the company's $500,000 of assets each year. The Rosebud Motel is currently the only place to stay for 50 miles. What should Rosebud's cost-plus price be if sales volume and costs are expected to stay consistent? OA. $133.33 OB. $185.42 OC. $2,150.00 OD. $152.08 OE. The Rosebud Motel would not set its price as it is a price-taker in this market.A bank pays one percent interest on savings accounts four times a year. The effective annualinterest rate is?Describe the net future worth of the project?
- Macmillan Learning Investment - End of Chapter Problem In your first year of work you deposit $1,200 in your retirement account at an 8% interest rate. Calculate how much your investment is worth after each of the given time periods. Round your answers to the nearest dollar. 5 years: $ 20 years: $ 40 years: $ 1763 4320 Incorrect 8640 Incorrect 10 years: $ 30 years: $ 50 years: $ 2160 Incorrect 6480 Incorrect 10800 IncorrectYou are a financial analyst for the ABC Company. The director of capital budgeting has asked you to analyse a proposed capital investment 'Projects A' which promises the cashflows as shown below. The project has a cost of capital of 6%. Calculate the project's DPBP, NPV and Pl. Based on all those parameters, would you recommend investing into this project and why? Use the table and fields below to complete the task. Time 1 Cash flow -€7,000 €5,500 €1,000 €2,000 Discounted cash flow Accumulated discounted cash flow NPV PI (show the calculation) DPBP (show the calculation)b) A stock you are evaluating just paid an annual dividend of £2.50. Dividends have grown at a constant rate of 1.5% over the last 15 years and you expect this to continue. i. If the required rate of return on the stock is 12%, what is the fair present value? If the required rate of return on the stock is 15%, what should the fair value be four years from today? ii.
- If a company predicted rate of inflation goes down (deflation), what happens to the net present value (NPV) of their projects?What is the annual worth of this investment? $Project P has a cost of $1,000 and cash flows of $300 per year for three years plus another $1,000 in Year 4. The discount rate is 15 percent. a. What's the discounted payback period? b. If the company requires a payback of three years or less, would the project be accepted?
- Kwame Nkrumah University of Cape Coast, Legon spent GHS1.8 million to install solar panels atop a parking garage. These panels will have a capacity of 500 kw, have a life expectancy of 20 years and suppose the discount rate is 10%.a. If electricity can be purchased for costs of GHS0.10 per kwh, how many hours per year will the solar panels have to operate to make this project break even?b. If efficient systems operate for 2,400 hours per year, would the project break even?c. The university is seeking a grant to cover capital costs. How big of a grant would make this project worthwhile (to the university)?Is it worth investing in a project that costs up to 600 million dollars across 11 years but is expected to bring tens of billions of dollars in benefit between 60 and 120 years from now when there is a 0 percent discount rate? Why or why not? What about a discount rate greater than 0, should the policy be implemented then?How can the Calculation of Return on Invested Capital for Mixed Investments be done?