The annual income from the mine is P100,000 and the life of the mine is 25 years. Find the price that an investor is willing to pay for if he considers that money is worth 5% and if he is to accumulate a sinking fund at 7% in order to replace the capital he invested?

Q: ,what is the NPV of this​ investment?

A: Net Present Value: It is a measure of profitability and shows the absolute profit or loss made from…

Q: The net present value method is used to evaluate capital investments. Imagine you are considering…

A: Net Present Value  of a project is the sum of the present value of  all future cash inflows less the…

Q: You have been offered the opportunity to invest in a project that will pay$3,509per year at the end…

A: Formula to calculate Future Value of this cash flows patter is as follows:  FV = C1*(1+r)4 +…

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A: Net present value refers to the method of capital budgeting used for evaluating the viability of the…

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A: Perpetual cashflows means cash flows which will occur forever or for a indefinite period.

Q: You own building P and building X. The next cash flow for each building is expected in 1 year.…

A: Perpetual cash flow refers to the infinite generation of income from the asset in future course of…

Q: required 10% return on his money. A property had gross annual income of $110,000, a vancy rate of…

A: The property is long term investment and valuation of property is done based on the earning…

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A: Annual Worth is a financial evaluation technique used to determine the equal annual cost or…

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A: It can be calculated using =NPER(rate,pmt,pv,[fv],[type]) Rate The interest rate for the loan. Nper…

Q: You own building U and building M. The next cash flow for each building is expected in 1 year.…

A: 1. Perpetual cashflows means cash flows which will occur forever or for a indefinite period. 2.…

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A: IRR is the internal rate of return and at this net present value is equal to zero and present value…

Q: An investor invests £10,000,000 in a new factory, which takes a year to build. After construction…

A: Yield of investment refers to the return earned by the project over the investment made initially…

Q: You are offered an asset that costs $150,000 and has cash flows of $1,350 at the end of every month…

A: IRR function = IRR(cashflows) NPV function = NPV(rate, cashflows) + initial cashflow Rate = 9%/12…

Q: An investor is considering two investment projects. Project A requires an initial payment of…

A: Here,Initial Investment of Project A is £13,000Cash Flow in Year 1of Project A is £18,600Initial…

Q: Tomato Inc. has a Ketchup project that has a initial investment of $ 1,000,000, The estimated life…

A: Present Value is the Current value and discounted value of the all future cash flows or sum of money…

Q: Click to see additional instrùctions The internal rate of return, rounded to two decimal places as a…

A: Internal Rate of Return The internal rate of return refers to the exact return that an investment…

Q: You have an opportunity to invest $106,000 now in return for $79,300 in one year and $29,100 in…

A: Data given: Initial Investment ($) = 106,000 Cash flow(Year 1) = $ 79300 Cash flow (Year 2) = $…

Q: Peaceful Cruises wants to build a new cruise ship that has an initial investment of $300 million. It…

A: Note : As per guideline we can solve only one question at a time so kindly post the other questions…

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A: A perpetuity is a security that generates an endless source of cash flow.It is effectively an…

Q: You have an opportunity to invest $ 108 000 now in return for $ 79500 in one year and $ 30 comma 300…

A: The objective of this question is to calculate the Net Present Value (NPV) of an investment…

Q: An investor pays $275,000 for a mine that will produce level annual revenue for 18 years. What…

A: A "sinking fund" is money that is put aside specifically for a future expenditure of some kind. A…

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A: Part (a) First calculate the present value of the total cost PV of total cost = Price paid for gold…

Q: Suppose Drake Pile Co. is considering a project to invest in a racehorse over the next 12 years.…

A: Here,Cost of Project (PV) is $130,000Revenue in Year 12 (FV) is $431,500Time Period (n) is 12…

Q: Compute the net present value of the investment project at an interest rate of 5% p.a.

A: Net present value means the total value an investment is adding to the company or stock, the higher…

Q: Imagine you are going to have a project to sell a Massive Machinary you owned. You have invested THB…

A: The question is based on the concept of Cost Accounting. Net present value is the difference between…

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A: Net present value is the difference between present value of cash inflows and outflows.

Q: Jack Sprat Inc. wants to know if they invest 11,548 in new exercise equipment, plus $2,000 for…

A: Initial investment = 11,548 + 2,000 = 13,548 To calculate the payback period, we need to find the…