Solve only a) using excel Two design alternatives (X and Y) are being considered for a...
Solve only a) using excel
Two design alternatives (X and Y) are being considered for a new ride at the Disney Theme park. Alternative X requires a $400,000 investment and will produce net annual revenue of $43708 every year. Alternative Y requires a $ 480,000 investment and produces 1st year revenue of $ 43708; thereafter revenue decreases by $3,000 every year.
a)Based on a 6% MARR, which design alternative (X or Y) has the smallest Discounted Payback Period?
Homework Answers
The question demands for calculation of Discounted Payback period of both the alternative using the info provided in the question.
MARR 6%
Outflow of X $400000
Outflow of Y $480000
Inflow of X $ 43708
Inflow of Y $43708 with deccreasing $3000 per year.
The answer is attached herewith
Add Answer to:
Solve only a) using excel
Two design alternatives (X and Y) are being considered for a...
Problem 4. (10 Pts) Two design alternatives (X and Y) are being considered for a new...
Problem 4. (10 Pts) Two design alternatives (X and Y) are being considered for a new ride at the Disney Theme park. Alternative X requires a $400,000 investment and will produce net annual revenue of $ BBB every year. Alternative Y requires a $ 480,000 investment and produces 1st year revenue of $ CCC; thereafter revenue decreases by S3,000 every year. Based on a (AAA + 5)% MARR, which design alternative (X or Y) has the smallest Discounted Payback Period?...
Practice Problem 2 • Two alternative designs are under consideration for a new ride called the...
Practice Problem 2 • Two alternative designs are under consideration for a new ride called the Scream Machine at a theme park located in Florida. The two candidate designs differ in complexity, cost and predicted revenue. Alternative A will require an investment of $300,000 and is estimated to produce revenue of $55,000 annually over a 10-year horizon. Alternative B will require an investment of $450,000 and is expected to generate annual revenue of $80,000. A negligible salvage value is assumed...
Two mutually exclusive design alternatives are being considered for purchase. Doing nothing is also an option....
Two mutually exclusive design alternatives are being considered for purchase. Doing nothing is also an option. The estimated cash flows for each alternative are given below. The MARR is 10% per year. Using the PW method, which alternative, if either, should be recommended? Capital Investment Annual Revenues Annual Expenses MV at end of useful life Useful Life IRR Alternative 1 $15,000 $8,000 $2,900 $2,000 4 years 17.2% Alternative 2 $23,000 $12,000 S3,000 $800 12 years 38.4%
Do not use Excel or tables 9-54 Three mutually exclusive alternatives are being considered: Initial cost...
Do not use Excel or tables
9-54 Three mutually exclusive alternatives are being considered: Initial cost Benefit at end of the first $500 $400 $300 200 200 200 100 4 year Uniform benefit at end of 100 125 subsequent years Useful life, in years At the end of its useful life, an alternative is not replaced. If the MARR is 10%, which alternative should be selected (a) Based on the payback period? (b) Based on benefit-cost ratio analysis?
USE ANNUAL WORTH Analysis Two mutually exclusive design alternatives are being considered. The estimated cash flows...
USE
ANNUAL WORTH Analysis
Two mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are given in the following table with MARR = 10% per year. Suggest your recommendation by using multiple attribute annual worth AW analysis. Design A Design B Investment cost (RM) 28,000 55,000 One-off expenses 10,000 13,000 In year 4 (RM) Annual revenues (RM) 22,000 28,000 Market value (RM) 6,000 8,000 Useful life 10 years 6 years
Three mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are...
Three mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are given next. The MARR is 20% per year. At the conclusion of the useful life, the investment will be sold. B Investment cost Annual expenses Annual revenues Market value Useful life $28,000 $15,000 $23,000 $6,000 10 years 10 years 10 years 26.4% $55,000 $40,000 $22,000 $32,000 $10,000 $13,000 $28,000 $8,000 24.7% 22.4% IRR A decision-maker can select one of these alternatives or decide to...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life of 10 years. The estimated sales and cost data for each alternative are shown. Annual revenues are based on the number of units sold and the selling price. Annual expenses are based on the fixed and variable costs. If the MARR is 20% per year, determine which alternative is preferable based on the PW Method. 12 Investment cost Units to be sold each year...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life of 10 years. The estimated sales and cost data for each alternative are shown. Annual revenues are based on the number of units sold and the selling price. Annual expenses are based on the fixed and variable costs. If the MARR is 20% per year, determine which alternative is preferable based on the PW Method. 12 Investment cost Units to be sold each year...
Assume a $52,000 investment and the following cash flows for two alternatives. Year Investment X Investment...
Assume a $52,000 investment and the following cash flows for two alternatives. Year Investment X Investment Y 1 $ 12,000 $ 20,000 2 18,000 25,000 3 15,000 17,000 4 10,000 — 5 15,000 — a. Calculate the payback for investment X and Y. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Payback Investment X years Investment Y years b. Which alternative would you select under the payback method? Investment X Investment Y
*Two mutually exclusive cost alternatives, Machine A and Machine B, are being evaluated Given the following...
*Two mutually exclusive cost alternatives, Machine A and Machine B, are being evaluated Given the following time events and incremental cash flow. If the MARR IS 12% per year, which alternative Machine A or Machine B) should be selected on the basis of rate of return? Assume Machine B requires the extra $8,000 initial Investment (Hint: You can solve with IRR function in Excel) Incremental Year Cash Flow S(Machine B-A) - 8,000 500 1.500 6,000 The "Incremental ROR" is more...
Problem 4. (10 Pts) Two design alternatives (X and Y) are being considered for a new ride at the Disney Theme park. Alternative X requires a $400,000 investment and will produce net annual revenue of $ BBB every year. Alternative Y requires a $ 480,000 investment and produces 1st year revenue of $ CCC; thereafter revenue decreases by S3,000 every year. Based on a (AAA + 5)% MARR, which design alternative (X or Y) has the smallest Discounted Payback Period?...
Practice Problem 2 • Two alternative designs are under consideration for a new ride called the Scream Machine at a theme park located in Florida. The two candidate designs differ in complexity, cost and predicted revenue. Alternative A will require an investment of $300,000 and is estimated to produce revenue of $55,000 annually over a 10-year horizon. Alternative B will require an investment of $450,000 and is expected to generate annual revenue of $80,000. A negligible salvage value is assumed...
Two mutually exclusive design alternatives are being considered for purchase. Doing nothing is also an option. The estimated cash flows for each alternative are given below. The MARR is 10% per year. Using the PW method, which alternative, if either, should be recommended? Capital Investment Annual Revenues Annual Expenses MV at end of useful life Useful Life IRR Alternative 1 $15,000 $8,000 $2,900 $2,000 4 years 17.2% Alternative 2 $23,000 $12,000 S3,000 $800 12 years 38.4%
Do not use Excel or tables
9-54 Three mutually exclusive alternatives are being considered: Initial cost Benefit at end of the first $500 $400 $300 200 200 200 100 4 year Uniform benefit at end of 100 125 subsequent years Useful life, in years At the end of its useful life, an alternative is not replaced. If the MARR is 10%, which alternative should be selected (a) Based on the payback period? (b) Based on benefit-cost ratio analysis?
USE
ANNUAL WORTH Analysis
Two mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are given in the following table with MARR = 10% per year. Suggest your recommendation by using multiple attribute annual worth AW analysis. Design A Design B Investment cost (RM) 28,000 55,000 One-off expenses 10,000 13,000 In year 4 (RM) Annual revenues (RM) 22,000 28,000 Market value (RM) 6,000 8,000 Useful life 10 years 6 years
Three mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are given next. The MARR is 20% per year. At the conclusion of the useful life, the investment will be sold. B Investment cost Annual expenses Annual revenues Market value Useful life $28,000 $15,000 $23,000 $6,000 10 years 10 years 10 years 26.4% $55,000 $40,000 $22,000 $32,000 $10,000 $13,000 $28,000 $8,000 24.7% 22.4% IRR A decision-maker can select one of these alternatives or decide to...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life of 10 years. The estimated sales and cost data for each alternative are shown. Annual revenues are based on the number of units sold and the selling price. Annual expenses are based on the fixed and variable costs. If the MARR is 20% per year, determine which alternative is preferable based on the PW Method. 12 Investment cost Units to be sold each year...
2) Two mutually exclusive design alternatives are being considered, with each one having a useful life of 10 years. The estimated sales and cost data for each alternative are shown. Annual revenues are based on the number of units sold and the selling price. Annual expenses are based on the fixed and variable costs. If the MARR is 20% per year, determine which alternative is preferable based on the PW Method. 12 Investment cost Units to be sold each year...
*Two mutually exclusive cost alternatives, Machine A and Machine B, are being evaluated Given the following time events and incremental cash flow. If the MARR IS 12% per year, which alternative Machine A or Machine B) should be selected on the basis of rate of return? Assume Machine B requires the extra $8,000 initial Investment (Hint: You can solve with IRR function in Excel) Incremental Year Cash Flow S(Machine B-A) - 8,000 500 1.500 6,000 The "Incremental ROR" is more...
Most questions answered within 3 hours.
-
When a solid dissolves in water, heat may be evolved or
absorbed. The heat of dissolution...
asked 1 minute ago -
Leechtown Co. has 4.3 percent coupon bonds on the market with 18
years left to maturity....
asked 3 minutes ago -
Comment on how the conference could have been improved What
additional elements would you consider adding...
asked 12 minutes ago -
Sandra Clothing Company has invested $51,000,000 in its
business. The target rate of return for the...
asked 13 minutes ago -
"Discover the privacy concerns when applying Artificial
Intelligence into Big Data"
asked 13 minutes ago -
Explain why organisms that can survive and/or grow under aerobic
conditions need the enzymes catalase and...
asked 19 minutes ago -
Moonwalker Corporation issued 2,000 shares of its $10 par value
common stock for $60,000. Moonwalker also...
asked 18 minutes ago -
A microphone connected to an amplifier takes a 10 dB voice and
turns it into a...
asked 23 minutes ago -
Suppose the mean time spent by all Harper College students
preparing for final exams is believed...
asked 38 minutes ago -
Imagine you are examining the effects of smoking in
heart-disease death rates. You collect an SRS...
asked 40 minutes ago -
Use the price-demand equation to find E(p), the elasticity of
demand.
x=f(p)=150 - 55 ln(p)
E(p)...
asked 35 minutes ago -
Suppose you deposit $1000 today in an account, expecting at some
point to receive $2000. This...
asked 38 minutes ago