The table below shows a comparison between three mutually exclusive alternatives. If the capital investment of A < B < C, and the MARRis 15%, arrange these alternatives based on decreasing Annual worth (From the Highest annual worth to the Lowest annual worth)?ComparisonACB-A C-A | C-BRR%19516.717.4 16.2 15.4 17.6О а. ВСАO b. CABО с. СВАO d. BACcompany's required rate of return is 10% and, in using the present worth method, a project's net present value is zero, this indicates thattheO a. project earns a rate of return of 10%.O b. project's rate of return exceeds 10%.C. project earns a rate of return of 0%.d. project's rate of return is less than the minimum rate required.

The capital budgeting is a technique that helps to analyze the profitability of the project that…

The table below shows a comparison between three mutually exclusive alternatives. If the capital investment of A < B < C, and the MARR is 15%, arrange these alternatives based on decreasing Annual worth (From the Highest annual worth to the Lowest annual worth)? Comparison A B B-A C-A | C-B RR% 195 16.7 17.4 16.2 15.4 17.6 О а. ВСА ОБ. САВ О с. СВА O d. BAC

The table below shows a comparison between three mutually exclusive alternatives. If the capital investment of A < B < C, and the MARR is 15%, arrange these alternatives based on decreasing Annual worth (From the Highest annual worth to the Lowest annual worth)? Comparison A B B-A C-A | C-B RR% 195 16.7 17.4 16.2 15.4 17.6 О а. ВСА ОБ. САВ О с. СВА O d. BAC

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Determine the future value of the following single amounts (FV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) (Round your final answers to nearest whole dollar amount.): Invested Amount Future Value 1. 14,000 7% 15 2. 21,000 6% 16 3. 33,000 12% 15 54,000 5% 11 4.
(a) For each of the projects in the table below identify the simple investments and the non-simple investments. (b) For each of the projects in the table below with an internal rate of return (IRR), determine that IRR. In A, $ В, $ C, $ -17 42.76 -65,500 1 20 |-18 -12,500 2 10 18 -6,459
Approximately, what is the value of the total Present worth (where Ptotal= PA + PG) if G (arithmetic gradient) =160, n=2 years, A=240 and i= 2.5% per year? Select one: a. 738 b. 511 c. 615 d. 825 not use excel
Evaluate the two alternatives A and B and decide the economic justified alternative using: Present worth method Future worth method 9 9 Annual worth method E.R.R Method I.R.R method E.R.R.R method 9 M.A.R.R 15%, the details of alternatives are shown in the table below Alternatives A B Investments $60,000 $75,000 Useful life (years) 5 10 Annual disbursements $25,000 $35,000 Annual revenues $45,000 $60,000 Salvage values $5,000 $10,000
The equivalent annual worth of alternative A is closest to:a. $-25,130b. $-37,100c. $-41,500d. $-42,900
For the four revenue alternatives below, use the ROR method results to answer the question below Alternative A B с D Initial Investment, $ -60,000 -90,000 -140,000 -190,000 Alternative D Overall ROR, Ai*% When Compared with Alternative ¡*% A B с 11.7 22.2 17.9 15.8 43.3 22.5 17.8 10.0 10.0 Problem 08.034.c- Choose from more than two alternatives based on incremental ROR analysis ✓should be selected. 10.0 Which one should be selected if the MARR is 10% per year and the alternatives are mutually exclusive?
D-78 Which of the following equations can be used to find the internal rate of return (i) for a project that hun initial investment of P, net annual cash flows of A, and salvage value of S after n years? (a) 0 = -P + AP/A, i%,n) + SP/A, i%, n) | (b) (Р — А)P/А, 1%, п) — SPIF, 1%, n) (с) — А %3D — РАР, %, п) — S(AF, i1%, п — 1) (d) 0 = -PF/P, i%,n) + A(F/A, i%, n) + S
Determine the present value of the following single amounts (EV of $1, PV of $1. EVA of $1. PVA of S1. EVAD of S1 and PVAD of S1 (Use appropriate factor(s) from the tebles provided. Round your final answers to nearest whole dollar amount.) Future Amount Present Value 1. 34,000 5% 15 2. 28,000 6% 17 3. 39,000 10% 18 14 54,000 9% 11 54
Home NPV-Mutually exclusive projects Hook Industries is considering the replacement of one of its old metal stamping machines. Three alternative replacement machines are under consideration. The relevant cash flows associated with each are shown in the following table: . The firm's cost of capital is 14%. se Options a. Calculate the net present value (NPV) of each press. b. Using NPV, evaluate the acceptability of each press. c. Rank the presses from best to worst using NPV. d. Calculate the profitability index (PI) for each press. e. Rank the presses from best to worst using PI. ar a. The NPV of press A is $ (Round to the nearest cent.) The NPV of press B is $ (Round to the nearest cent.) The NPV of press C is $ (Round to the nearest cent.) b. Based on NPV, Hook Industries should V press A. (Select from the drop-down menu.) Based on NPV, Hook Industries should V press B. (Select from the drop-down menu.) Enter your answer in each of the answer boxes. P Type here to search hp
Vilas Company is considering a capital investment of $190,600 in additional productive facilities. The new machinery is expected to have a useful life of 5 years with no salvage value. Depreciation is by the straight-line method. During the life of the investment, annual net income and net annual cash flows are expected to be $12,700 and $49,600, respectively. Vilas has a 12% cost of capital rate, which is the required rate of return on the investment. Click here to view PV table. (a) Compute the cash payback period. (Round answer to 2 decimal places, e.g. 10.50.) Cash payback period 3.83 years Compute the annual rate of return on the proposed capital expenditure. (Round answer to 2 decimal places, e.g. 10.50.) Annual rate of return 6.66316894 %
Garrison Company has two Investment opportunitles. A cash flow schedule for the Investments Is provided below: Year Investment A Investment B $(4,900) 1,960 1,960 1,960 $(5,850) 2,940 2 1,960 1,960 4 1,960 980 Considering the unequal Investments, which of the following techniques would be most approprlate for choosIng between Investment A and Investment B? Multiple Choice Payback method Present value index Net present value method None of these answers is correct
A company, which uses a MARR of 896, has been presented an investment opportunity that is summarized below, the standard notation for determining the Rate of Return for the proposed investment based on present worth is: year 1 3 8 Cash Flow $(440) $15 $35 $55 $75 $95 $115 $135 $155 (x1000) O 0 - 440,000 - 15,000(P/A, 196, 8) - 20,000(P/G, 196, 8) O None of them O 0 = -440,000 + 15,000(P/A, 196, 8) + 20,000(P/G, 196, 8) O 0= -440,000 + 155,00O(P/A, 196, 8) - 20,000(P/G, 196, 8) O ROR = -440.000 + 15.000(P/A, 896, 8) + 20,000(P/G, 896, 8) O 0 = -440,000 + 15,000(P/A, 196, 8) + 20,000(P/G. 196, 7) O 0--440.000 + 20.000(P/A, 196, 8) + 15,000(P/G, 196, 8)

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