Is considering purchasing a water park in charlotte, north carolinaâ, for $2,000,000. the new facility will generate annual net
cash inflows of $520,000 for ten years. engineers estimate that the facility will remain useful for ten years and have no residual value. the company usesâ straight-line depreciation. its owners want payback in less than five years and an arr of 12â% or more. management uses a 14â% hurdle rate on investments of this nature?
Given: <span>initial investment 2,000,000. the new facility will generate annual net cash inflows of $520,000 for ten years. engineers estimate that the facility will remain useful for ten years and have no residual value.
Payback period = Initial Investment / Cash Inflow per period Payback period = 2,000,000 / 520,000 Payback period = 3.85 years or 3 years and 10 months.
Accounting Rate of Return (ARR) = Average Annual Profit / Average Annual Investment Average annual profit = 520,000 Average annual investment = 2,000,000 / 10 years = 200,000 ARR = 520,000 / 200,000 = 2.60 or 260%
Technical profession is a highly skill based profession in which a practical knowledge is required.Example:engineering in civil,mechanical,computer e.t.c.
A) Establish high standards for being hired for any Camp Bow Wow job and set commensurately high compensation.
Explanation:
Setting compensation that is competitive will keep employees happy with the work that they are putting and they will feel that they are being fairly rewarded for the amount of work that they are doing. Also maintaining high standards will keep business processes running smoothly and always present the company with the opportunity to implement new ideas as staff are competent and will most likely be eager to adopt the innovative ideas / concepts. Feeling as though it is a privilege to work for Camp Bow Wow will keep employees motivated and eager to perform.
C. a movement down along the supply curve for that good.
Explanation:
A decrease in price would lead to a decrease in the quantity supplied and a movement down along the supply curve.
This is in accordance to the law of supply which says the higher the price, the higher the quantity supplied and the lower the price, the lower the quantity supplied.