The Ajax Corporation has the following set of projects available to it:ProjectABCсDENote: All projects have equal risk.G▼FCalculate the cumulative investment and complete Ajax's schedule of potential projects. (Hint: Ajax prioritizes projects according to their expectedrates of return.)ProjectABDYGEInvestment Required Expected Rate of Return($ Million)(%)50023.017518.05021.012516.030014.015013.025019.0Investment Required Expected Rate of Return($ Million)(%)50023.050O $1,025O $1,300250O $975O $1,000175125 ▼300150 ▼21.021.019.018.016.0 ▼14.013.0 ▼Cumulative Funds Raised($ Million)250Ajax can raise funds with the following marginal costs. Calculate the cumulative funds raised to complete the following table.Block of Funds Cost of Capital($ Million)(%)First 25014.0Next 25015.5Next 10016.0Next 25016.5Next 20018.0Next 200500600What is the optimal capital budget (in millions) for Ajax?8501,0501,250Cumulative Investment($ Million)500550800700675

The expected return is the gain or loss that an investor forecast on an investment that has known…

The Ajax Corporation has the following set of projects available to it: Project A D B с D E F G Note: All projects have equal risk. Project A с B Investment Required ($ Million) 500 175 50 125 300 Calculate the cumulative investment and complete Ajax's schedule of potential projects. (Hint: Ajax prioritizes projects according to their expected rates of return.) E 150 250 250 Investment Required Expected Rate of Return ($ Million) (%) 500 23.0 50 175 125 ▼ 300 Expected Rate of Return (%) 23.0 18.0 21.0 16.0 14.0 13.0 19.0 150 ▼ 21.0 19.0 18.0 16.0 ▼ 14.0 13.0 ▼ Cumulative Funds Raised ($ Million) 250 500 600 Cumulative Investment ($ Million) 500 550 850 1,050 1,250 800 700 Ajax can raise funds with the following marginal costs. Calculate the cumulative funds raised to complete the following table. Block of Funds Cost of Capital ($ Million) (%) First 250 14.0 Next 250 15.5 Next 100 16.0 Next 250 16.5 Next 200 18.0 Next 200 21.0 675

The Ajax Corporation has the following set of projects available to it: Project A D B с D E F G Note: All projects have equal risk. Project A с B Investment Required ($ Million) 500 175 50 125 300 Calculate the cumulative investment and complete Ajax's schedule of potential projects. (Hint: Ajax prioritizes projects according to their expected rates of return.) E 150 250 250 Investment Required Expected Rate of Return ($ Million) (%) 500 23.0 50 175 125 ▼ 300 Expected Rate of Return (%) 23.0 18.0 21.0 16.0 14.0 13.0 19.0 150 ▼ 21.0 19.0 18.0 16.0 ▼ 14.0 13.0 ▼ Cumulative Funds Raised ($ Million) 250 500 600 Cumulative Investment ($ Million) 500 550 850 1,050 1,250 800 700 Ajax can raise funds with the following marginal costs. Calculate the cumulative funds raised to complete the following table. Block of Funds Cost of Capital ($ Million) (%) First 250 14.0 Next 250 15.5 Next 100 16.0 Next 250 16.5 Next 200 18.0 Next 200 21.0 675

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The Ajax Corporation has the following set of projects available to it:
Project
A
B
C
с
D
E
Note: All projects have equal risk.
G▼
F
Calculate the cumulative investment and complete Ajax's schedule of potential projects. (Hint: Ajax prioritizes projects according to their expected
rates of return.)
Project
A
B
DY
G
E
Investment Required Expected Rate of Return
($ Million)
(%)
500
23.0
175
18.0
50
21.0
125
16.0
300
14.0
150
13.0
250
19.0
Investment Required Expected Rate of Return
($ Million)
(%)
500
23.0
50
O $1,025
O $1,300
250
O $975
O $1,000
175
125 ▼
300
150 ▼
21.0
21.0
19.0
18.0
16.0 ▼
14.0
13.0 ▼
Cumulative Funds Raised
($ Million)
250
Ajax can raise funds with the following marginal costs. Calculate the cumulative funds raised to complete the following table.
Block of Funds Cost of Capital
($ Million)
(%)
First 250
14.0
Next 250
15.5
Next 100
16.0
Next 250
16.5
Next 200
18.0
Next 200
500
600
What is the optimal capital budget (in millions) for Ajax?
850
1,050
1,250
Cumulative Investment
($ Million)
500
550
800
700
675

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