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![For the following cash flow, determine the benefit cost ratio at 6%. Is the project economically efficient?
Year
0
10
20
Action
Establish trees
Forest health thinning
Harvest of timber
Cash Flow
($25,000)
($5,450)
$90,000
6%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F120c29ba-91f5-4a7e-92f1-ff8cc944a33a%2Fdbb426dd-eec7-441d-b6a2-b9f374911f99%2Fbhgeohf_processed.jpeg&w=3840&q=75)
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- Q2C) Use Incremental benefit cost analysis method to compare between the following three projects. Use i=9%/yr.: Project Project A Project C Project D Item Annual Benefits to $10,000 $6,000 $8,000 pablic Annual Disbenefits $2000 $3,000 $1,500 to public Capital Investment $20,000 $15,000 $14,000 Annual Operational $1,000 $1,800 $2.000 Cost Useful Life 10 years 12 years 15 yearsality is working on following two mutually exclusive proposals for increasing and optimizing the traffic lighting. Find the best option by using the Benefit/Cost ratio analysis given that the MARR 10%. Project-I Project-II Initial cost ($) 900,000 1,700,000 Annual operating cost ($/ per year) 120,000 60.000 Annual benefit ($ / per year) 730,000 650,000 Annual disbenefit ($ / per year) 300,000 195,000 Life (years) 10 25An interior design studio is trying to choose between the following two mutually exclusive design projects: Year 0 1 2 3 Cash Flow Cash Flow (0) -$64,000 31,000 31,000 31,000 a-1 If the required return is 10 percent, what is the profitability index for both projects? (Round your answers to 3 decimal places. (e.g., 32.161)) Project I Project II -$18,000 9,700 9,700 9,700 Profitability Index a-2 If the company applies the profitability index decision rule, which project should the firm accept? O Project I O Project II Project I Project II b-1 What is the NPV for both projects? (Round your answers to 2 decimal places. (e.g., 32.16)) O Project I Project II NPV b-2lf the company applies the NPV decision rule, which project should it take?
- Determine the best alternatives for a government project with the following data: PROJECT A B C ANNUAL BENEFIT P250,000.00 P320,000.00 P350,000.00 ANNUAL COSTS P100,000.00 P135,000.00 p180,000.00 B/C RATIO 2.5 2.37 1.94 What is the best Project and its incremental ratio? a. A = 1.2 b. A = 2 c. B = 2.0 d. B = 1.18Carla Vista Mills management is evaluating two alternative heating systems. Costs and projected energy savings are given in the following table. The firm uses 11.50 percent to discount such project cash flows. Year System 100 System 200 0 –$1,718,600 –$1,416,700 1 270,810 598,700 2 504,930 523,800 3 800,740 541,300 4 737,300 300,100 What is the NPV of both systems? And Which one should be chosen? (Enter negative amounts using negative sign, e.g. -45.25. Do not round discount factors and intermediate calculations. Round final answers to 0 decimal places, e.g. 5,275.)A project needs an initial investment of $100 and generates -$20 and $130 in year 1 and 2 respectively. What is the MIRR using the discounting method (WACC=10%)? 4.67 4.79 4.85% 4.88% Selected
- Compute the project cost. Gross income 1,000,000 Life of project Operating cost Rate of project 500,000 5 years 20% Benefit ratio 1.08 O a. P1,384,543.00 O b. P1,348,543.00 O c. P1,384,534.00 O d. P1,384,453.00Oriole Mills management is evaluating two alternative heating systems. Costs and projected energy savings are given in the following table. The firm uses 11.5 percent to discount such project cash flows. Year 0 1 2 3 4 System 100 -$1,993,000 243,810 607,730 773,740 977,200 NPV of system 100 is System 200 -$1,717,300 NPV of system 200 is $ What is the NPV of the systems? (Enter negative amounts using negative sign, e.g. -45.25. Do not round discount factors and intermediate calculations. Round final answers to O decimal places, e.g. 5,275.) tA 862,000 $ 583,900 558,200 342,300Consider the following information about a project: PROJECT YEAR O YEAR 1 YEAR 2 YEAR 3 YEAR 4 COSTS $160,000 $43,000 $50,000 $50,000 $64,000 BENEFITS $0 $400,000 $400, 000 $500,000 $500,000 a) Calculate the NPV assuming 10% discount rate b) Determine in which year will be the payback c) Calculate (ROI)? Provide the detail answer for your calculation.
- Determine which of the following three alternatives is most efficient and which one is more profitable using the incremental benefit/cost method. The rate is 5% per year. Alter. Construction cost $ Annual Salvage $ Life (yrs) Benefits $/yr A $450,000 $1,100,000 $750,000 $320,000 $360,000 $330,000 $40,000 $100,000 -20,000 10 15 13You are given the following cash flow information for Project A: Project A PV Outflows TV Inflows Year 0 -$150,000.00 1 $80,000.00 2 -$25,000.00 3 $50,000.00 4 $80,000.00 5 -$30,000.00 6 $75,000.00 -$150,000.00 $75,000.00 Totals Now assume that the project's cost of capital is 16.0 percent, but that its true reinvestment rate is 25.0 percent. Given this information, determine the difference between the project's net present value (NPV) and its modified net present value (MNPV). O $45,129.36 O $46,411.47 O $44,701.99 $45,556.73 $45,984.10Data pertaining to investment proposals is provided below: A B D -$40,000 $57,600 $17.600 Investment required -$260,000 $505,900 $245.900 -$125,000 -$640,000 $224,300 $99.300 6. Present vahue of cash inflows $1.021,400 NPV Usefil lfe of the project $381.400 6 Calculate project profitability index to rank proposals in tem of preference. Answer Choices: Project Investment profitability a. proposal Rank index preference 0.95 0.44 0.79 0.60 A 1st B 4th 2nd 3rd Project Investment profitability ь. proposal Rank preference 1.95 index A 1st B 1.44 4th 1.79 1.60 2nd D 3rd Project Investment profitability proposal Rank index preference 0.49 0.31 A 1st B 4th 0.44 2nd 0.37 3rd Project Investment profitability d. proposal Rank index preference A 1.45 1st B 0.94 4th 1.29 1.10 2nd 3rd D
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