Answer:
a. $316,920
Explanation:
The computation of the net present value for Project A is shown below:
The net present value = Cash inflow after considering the discount factor - initial cost or initial investment
Cash inflow after considering the discount factor = $7,400,000
The discount factor for 4 years at 18% = 0.5158
So, the cash inflow is
= $7,400,000 × 0.5158
= $3,816,920
And, the initial investment is $3,500,000
So, the net present value is
= $3,816,920 - $3,500,000
= $316,920
Answer:
The variable cost per mile is $1.50
The fixed cost element is $2,261
Explanation:
The computation of the fixed cost and the variable cost per hour by using high low method is shown below:
Variable cost per hour = (High Total cost - low total cost) ÷ (High miles driven - low miles driven)
= ($15,011 - $13,503) ÷ (8,500 - 7,495)
= $1,508 ÷ 1,005 hours
= $1.50
Now the fixed cost equal to
= High operating cost - (High miles driven × Variable cost per hour)
= $15,011 - (8,500 × $1.50)
= $15,011 - $12,750
= $2,261
Answer:
underpriced
Explanation:
Without mincing words, let us dive straight into the solution to the solution to the question. From the above problem, the following data or information are given:
=> market rate of return = 11 per cent, risk-free rate of return = 3 per cent, Lexant NV = 3 per cent less systematic risk than the market, actual return = 12 per cent.
The expected return = [ 11% - 3%] × 0.97 + 3% = 10.76%.
We are given the actual return to be 12% which is greater than the expected return which is 10.76%.
The equity is overpriced.
Answer:
Decreases the cost of manufacturing
Explanation:
Decreases the cost of manufacturing
Answer:
An energy mutual fund
Explanation:
An energy mutual fund is like a normal fund, with the difference that it invests your portfolio only on energy-sector companies, for example: oil companies, natural gas companies or coal companies (although these tend to be neither as profitable nor as common).
If you go to an energy mutual fund, you will be offered investment options such as common stock, preferred stock and corporate bonds, and you money will be spread in among those investment instruments. Your portfolio will be diversified in a sector that usually has good economic prospects.
