Homework Answers
A firm should only accept the projects with Internal rate of return above the MARR. If IRR is less than MARR firm value will decrease.
Hence, correct option is “4. Neither X or Y”
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Consider the following two alternatives and data given: YRX -100 -1100 -1000 12625022 226250224 326250224 26...
26. Consider the summary information for the random variables X and Y given below. = 100...
26. Consider the summary information for the random variables X and Y given below. = 100 -095 x=50 If an observation of X has the vahue 55, which of the following is MOST reasonable? A. The corresponding value of Y is 90 B. The corresponding value ofY is 110. C. We do not have enough information to know anything about the value of Y
Consider four alternatives, each of which has an 8-year useful life: A B &n
Consider four alternatives, each of which has an 8-year useful life: A B C D Initial cost $100 $80 $60 $50 Annual benefit $12.20 $12.00 $9.70 $12.20 Salvage Value $75.00 $50.00 $50.00 $0 a) Construct a plot with interest rate on the x axis and PW on the y axis. Plot the PW vs interest rate for all 4 alternatives. Label graphs and make sure the fonts are readable. If your computer chooses very light colors,...
1.Given is a decision payoff table. Future Demand Alternatives Low Moderate High Small Facility 53 31...
1.Given is a decision payoff table. Future Demand Alternatives Low Moderate High Small Facility 53 31 22 Medium Facility 29 42 32 Large Facility -5 30 53 a) The best decision under uncertainty using MAXIMAX is to select facility b) The best decision under uncertainty using MAXIMIN is to select facility c) The best decision under uncertainty using LAPLACE/EQUALITY LIKELY is to select facility d) If the probabilities for Future Demand when it is Low = 0.35, Moderate = 0.30,...
marr 13% the MARR is 12% Consider the following investment projects: 1 AC DE 0-1500-2000-2100-1000 1...
marr 13%
the
MARR is 12%
Consider the following investment projects: 1 AC DE 0-1500-2000-2100-1000 1 3000 1560 2800 3600 2-1500 944 -200 -5700 3 15 0 0 100 a) For each project, apply the sign rule to predict the number of possible IRR's b) Classify each project as either a simple or a non-simple investment. c) For each project, plot the NPW profile as a function of i between 0 and 120%. d) For each project, compute the value(s)...
13. 5.43 Consider the cash flows for two types of models given in Table 25.43 Table...
13. 5.43 Consider the cash flows for two types of models given in Table 25.43 Table P5.43 4:19 PM + Fit to pas n 0 - Model A $8,000 Model B -$15,000 $3,500 $10,000 $3,500 $10,000 $3.500 Table P5.43 Full Alternative Text Both models will have no salvage value upon their disposal (at the end of their respective service lives). The firm's MARR is known to be 1296 1. Notice that the models have different service lives. However, model A...
Consider the following payoff matrix in which the numbers indicate the profit in millions of dollars...
Consider the following payoff matrix in which the numbers
indicate the profit in millions of dollars for an oligopoly based
on either a high-price or a low-price strategy.
a. Situation
1: Each firm chooses a high-price
strategy.
Result: Each firm
will earn $ 200 million in profit for a total of $ 400 million for
the two firms.
b. Situation 2: Firm X chooses a
low-price strategy while Firm Y maintains a high-price
strategy.
Result: Firm X will earn $250...
Question 12 Suppose that a decision maker’s risk attitude toward monetary gains or losses x given...
Question 12 Suppose that a decision maker’s risk attitude toward monetary gains or losses x given by the utility function U(x) = (x+10,000)^0.5 If there is a 2.5% chance that the decision maker's car, valued at $5000, will be totaled during the next year, what is the most that she would be willing to pay each year for an insurance policy that completely covers the potential loss of her vehicle? Please round all answers (also intermediate results to 2 decimals)....
Up. Answer questions 13 to 15 using the following data: A winner of the Texas Lotto has decided to invest not more...
Up. Answer questions 13 to 15 using the following data: A winner of the Texas Lotto has decided to invest not more than $50,000 per year in the stock market. Under consideration are stocks for a petrochemical firm and a public utility. Although a long range goal is to get the highest possible return, some consideration is given to the risk involved with the stocks. A risk index on a scale of 1-10 ( with 10 being the most risky)...
1. Given the following horizontal curve and spiral data: Total tangent deflection angle (A) = 30°...
1. Given the following horizontal curve and spiral data: Total tangent deflection angle (A) = 30° Rt. D=50 Design Speed = 50 mph Two lane road in Southern Climate PI Station @ 64+20.00 Find and e from Table 13.8 or 13.9 (see handouts) Compute: R P= Compute the stations of: T.S. = S.C. = C.S. S.T. = Compute the Long Tangent and the Short Tangent PI 4 CPI To AC ST To S.C. C.S. SPI, SPI -Ls 20$ Cc 3...
Consider the following data set that contains information about a sample of ten 2015 Subaru Outback...
Consider the following data set that contains information about a sample of ten 2015 Subaru Outback offered for sale. Mileage Price Vehicle Condition Color (x1000miles) $1000) 1 poor silver 13 30 2. average white 22 29 3 average blue 29 28 4 average green 27 5 average silver 47 26 6 average red 24 7 good silver 53 23 8 excellent green 56 22 9 poor 64 21 10 excellent blue 65 20 The scatter plot that summarizes the data...
26. Consider the summary information for the random variables X and Y given below. = 100 -095 x=50 If an observation of X has the vahue 55, which of the following is MOST reasonable? A. The corresponding value of Y is 90 B. The corresponding value ofY is 110. C. We do not have enough information to know anything about the value of Y
marr 13%
the
MARR is 12%
Consider the following investment projects: 1 AC DE 0-1500-2000-2100-1000 1 3000 1560 2800 3600 2-1500 944 -200 -5700 3 15 0 0 100 a) For each project, apply the sign rule to predict the number of possible IRR's b) Classify each project as either a simple or a non-simple investment. c) For each project, plot the NPW profile as a function of i between 0 and 120%. d) For each project, compute the value(s)...
13. 5.43 Consider the cash flows for two types of models given in Table 25.43 Table P5.43 4:19 PM + Fit to pas n 0 - Model A $8,000 Model B -$15,000 $3,500 $10,000 $3,500 $10,000 $3.500 Table P5.43 Full Alternative Text Both models will have no salvage value upon their disposal (at the end of their respective service lives). The firm's MARR is known to be 1296 1. Notice that the models have different service lives. However, model A...
Consider the following payoff matrix in which the numbers
indicate the profit in millions of dollars for an oligopoly based
on either a high-price or a low-price strategy.
a. Situation
1: Each firm chooses a high-price
strategy.
Result: Each firm
will earn $ 200 million in profit for a total of $ 400 million for
the two firms.
b. Situation 2: Firm X chooses a
low-price strategy while Firm Y maintains a high-price
strategy.
Result: Firm X will earn $250...
Up. Answer questions 13 to 15 using the following data: A winner of the Texas Lotto has decided to invest not more than $50,000 per year in the stock market. Under consideration are stocks for a petrochemical firm and a public utility. Although a long range goal is to get the highest possible return, some consideration is given to the risk involved with the stocks. A risk index on a scale of 1-10 ( with 10 being the most risky)...
1. Given the following horizontal curve and spiral data: Total tangent deflection angle (A) = 30° Rt. D=50 Design Speed = 50 mph Two lane road in Southern Climate PI Station @ 64+20.00 Find and e from Table 13.8 or 13.9 (see handouts) Compute: R P= Compute the stations of: T.S. = S.C. = C.S. S.T. = Compute the Long Tangent and the Short Tangent PI 4 CPI To AC ST To S.C. C.S. SPI, SPI -Ls 20$ Cc 3...
Consider the following data set that contains information about a sample of ten 2015 Subaru Outback offered for sale. Mileage Price Vehicle Condition Color (x1000miles) $1000) 1 poor silver 13 30 2. average white 22 29 3 average blue 29 28 4 average green 27 5 average silver 47 26 6 average red 24 7 good silver 53 23 8 excellent green 56 22 9 poor 64 21 10 excellent blue 65 20 The scatter plot that summarizes the data...
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