Suppose that you undertook an investment pro-ject with the following estimated cash flows:nAn AT0-$152,000142,400253,400352,500462,500533,000At the end of year 3, you have received an offer tobuy the project from another firm; what minimumprice would be the fair price to ask? Here yourrequired return on investment is 15%.

Fair price would be the expected Cash flows atleast which are $79,300.57Explanation:After end of 3…

Answered: Suppose that you undertook an…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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# 3 QUESTION 10 Suppose the MARR is 5%. Use the following table to answer the question-Which option should be selected as the base alternative? Initial Investment Annual Revenue Useful Life (Years) E D $ 4 R CMS A. Neither option is acceptable as a base alternative. OB. Both options are acceptable base alternatives. OC. FMS OD. I'm completely lost! E. CMS F Click Save and Submit to save and submit. Click Save All Answers to save all answers. 888 74 $31,000 $38,000 6,866 % FMS 5 T 9,201 G 6 MacBook FO H & 7 F7 U +00 8 J 9 K Save All Answers P 7.
John wants to invest $1 000 000. He has two options. The first option is to buy government bonds that earn 4% annually. The second option is to buy an apartment building that brings him $100 000 per year in revenues. Compare the two options in terms of their internal rates of return. (Your answer in the answer box should be either 1 or 2). Calculations should be provided.
A labor saving device system save $2,000 per year for five (5) years. It can be installed at a cost of $8,000. The rate of return on this planned investment is most nearly: a.9.36% b.10% c.10.36% d.12.36%
Answer is -$3, 085,828 ( please show your work)
A semiconductor chip maker purchased a small manufacturing process plant for $2,131,020. The money coming in from that purchase was determined to be $500,000 annually in before-tax cash flow during its 10-year use. The net cash flow after tax is $300,000. If the chip maker wants to realize a 10% return on its investment after tax, for how many more years should the plant operate? (hint, tables)
The common stock of Eddie's Engines, Inc. sells for $15.75 a share. The stock is expected to pay S0.75 per share next month when the annual dividend is distributed. Eddie's has established a pattern of increasing its dividends by 4% annually and expects to continue doing so. What is the market rate of return on this stock? A. 8.26% B.11.34% C 10.12% D.14.97% E. 15%
If the profit function for selling smart phone screen magnifier is -4500p2 + 561500p – 11898000, what is the maximum profit that can be expected from selling smart phone screen magnifiers? Question 1 options: $ 0, no profit $ 5,617,681 $ 1,717,764 -$ 8,004,171
a) Define NPV (Net Present Value), Payback and IRR (Internal rate of Return). b) Calculate NPV of the following projects. Discount rate is 10%. c) Which project should be chosen and why? Project Mils proj A Cash flows £ proj B Year 0 Year 1 -10 2 Project Mils proj C Cash flows £ Year 0 Year 1 -10 7 Cash flows £ Project Mils Year 0 -8 Year 1 3 Year 2 Year 2 Year 2 5 5 3 Year 3 7 Year 3 2 Year 3 3
Sheridan Company is considering a long-term investment project called ZIP. ZIP will require an investment of $129,600. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $86,400, and annual cash outflows would increase by $43,200. The company's required rate of return is 12%. Click here to view the factor table. Calculate the internal rate of return on this project. (Round answers to O decimal places, e.g. 15%) Internal rate of return on this project is between Determine whether this project should be accepted? The project be accepted. % and %

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