Question

1. The following cash flows are associated with three alternatives under consideration by the firm: N (Year) 0 2 3 4 5 A1 (TL

0 0
Add a comment Improve this question Transcribed image text
Answer #1

please rate my answer well.

Add a comment
Know the answer?
Add Answer to:
1. The following cash flows are associated with three alternatives under consideration by the firm: N...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • 2) In the design of a new facility, the mutually exclusive alternatives in the table below...

    2) In the design of a new facility, the mutually exclusive alternatives in the table below are under consideration. Assume that the interest rate (MARR) is 15%. First draw the cash flow diagrams. Then, use the following methods to choose the best of these three feasible alternatives: Alternative 1 Alternative 2 Alternative 3 $ 11 $ 12 $ 13 Investment (first) cost (please see the table for your value) $ A1 $ A2 $ A3 Net cash flow per year...

  • Assume a $100,000 investment and the following cash flows for two alternatives. Year л во мн...

    Assume a $100,000 investment and the following cash flows for two alternatives. Year л во мн Investment X $30,000 35,000 25,000 20,000 15,000 Investment Y $50,000 40,000 30,000 a. Calculate the payback for investment X and Y. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Investment X years years Investment Y b. Which alternative would you select under the payback method? Investment X Investment Y

  • A firm is considering three mutually exclusive alternatives as part of an upgrade to an existing...

    A firm is considering three mutually exclusive alternatives as part of an upgrade to an existing transportation network. At EOY 10, alternative III would be replaced with another alternative Ill having the same installed cost and net annual revenues. If MARR is 10% per year, which alternative (if any) should be chosen? Use the incremental IRR procedure. $40,000 $6,500 $20,000 $5,200 Installed cost Net annual revenue Salvage value Useful life Calculated IRR $30,000 $5,600 0 20 years 18.0% 20 years...

  • The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives...

    The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives is 10 years. A В C Capital investment Annual expenses $60,000 $90,000 $40,000 $30,000 $70,000 35,000 45,000 15,000 30,000 40,000 25,000 16,000 Annual revenues 50,000 52.000 38,000 28,000 Market value at EOY 10 15,000 10,000 10,000 39.0% 10,000 IRR ??? 7.4% 30.8% 9.2% After the base alternative has been identified, the first comparison to be made in an incremental analysis should be which of...

  • Lane Industries is considering the replacement of one of its machines. Several alternatives are under consideration....

    Lane Industries is considering the replacement of one of its machines. Several alternatives are under consideration. The relevant cash flows associated with each are shown in the following table. The firm's cost of capital is 15%. Cash inflows Initial Inv Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Press A Press B Press C S106,250 $75,000 $162,500 $22,500 S15,000 $62,500 $22,500 $17,500 $37,500 $22,500 $20,000 $25,000 $22,500 $22,500 $25,000 S22,500 S25,000 S25,000 S22,500 S31,250...

  • engineering economy QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A...

    engineering economy QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A B C E Capital investment $60,000 $90,000 $40,000 $30,000 $70,000 Annual expenses $30,000 $40,000 $25,000 $15,000 $35,000 Annual revenues $50,000 $52,000 $38,000 $28,000 $45,000 MV at EOY 10 $15,000 $15,000 $10,000 $10,000 $15,000 IRR 31.5 % 7.4 % 30.8 % 42.5 % 9.2 % The life span of all alternatives is 10 years.. Using a MARR of 15 % per year, what is the...

  • Please write neatly. DO NOT USE EXCEL! Thank you. Question #4 (25 Points) Three alternatives are...

    Please write neatly. DO NOT USE EXCEL! Thank you. Question #4 (25 Points) Three alternatives are being considered. The table below shows the associated cash flows with each alternative The company uses MARR of 20% per year Alternative A $40,000 $38,000 $25,000 $10,000 6 vears 26% Alternative BAlternative C Capital investment Annual Revenu Annual Cost Salvage value Useful life IRR $60,000 $53,000 $30,000 $10,000 6 years 3390 $30,000 $28,000 $16,000 $10,000 6 vears 35% Using incremental analysis, determine which is...

  • A company is trying to determine which projects to fund. Since the firm does not have...

    A company is trying to determine which projects to fund. Since the firm does not have the capital budget to fund all the projects, rank each by IRR. If the firm’s capital budget is $75,000, which projects will be funded? What will the firm’s MARR be? Project $0 N (years) First Cost $10,000 $20,000 $30,000 $40,000 $35,000 $25,000 $20,000 Annual Benefits Salvage Value $2,500 $3,500 $5,000 $3,600 $3,000 $4,500 $10,000 $4,000 $5,000 $5,000 $3,000 $4,200 $10,000

  • 1. Will is trying to select the best investment from among 3 alternatives. Each alternative involves...

    1. Will is trying to select the best investment from among 3 alternatives. Each alternative involves an initial outlay of 100,000$. Their cash flows returns for each project are as follows (in $): year project C project A 10,000 20,000 30,000 40,000 50,000 project B 50,000 40,000 30,000 min 45,000 55,000 60,000 a) Evaluate and rank each alternative based on the payback period? What are the general problems associated with using this method? b) Evaluate and rank each alternative based...

  • 1. A&B Enterprises is trying to select the best investment from among three alternatives. Each alternative...

    1. A&B Enterprises is trying to select the best investment from among three alternatives. Each alternative involves an initial outlay of S100,000. The company's cost of capital is 10%. The incremental after tax cash inflows for each project are as follows: Year A B 20,000 $50,000 $25,000 2 20,000 40,000 25,000 3 20,000 30,000 25,000 4 30.000 25,000 5 60,000 25,000 8 a) Payback i) Calculate the payback period (1 decimal) for each project (3 marks). ii) Evaluate and rank...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
Active Questions
ADVERTISEMENT