Answer:
The Firm should not Buy and Install the press as it delivers a negative NPV of -$24,924 at 11% discount rate over its 4 year operations
Explanation:
The General rule is to appraise the investment based on various appraisal techniques.
A technique that should be considered must have special focus on the time value of money, the required rate of returns expected by the firm and other Cashflow considerations.
The Net Present Value (NPV) approach will be the best method to proceed with.
The NPV approach typically falls under the following decision tree:
a. If NPV is negative (Reject the proposal)
b. If NPV is positive (Accept if it's a singular project, Accept the highest positive NPV if it's for mutually exclusive Projects)
c. If Zero (this is the breakeven line at which the Project covers all its cost but does not return a profit.) Also referred to as the IRR
Kindly refer to the attached for detailed workings
Show interest, act professional, show that you want the job and show that you got what it takes and more. You're showing them that you want the job and no one is gonna take it from you (just don't be that cocky either) they don't like people who are too cocky or too much of a push over you have to have a good balance that will show that you're perfect for the work environment =.
Hope this helped!
Answer:
d. growth rate of real GDP per person.
Explanation:
The level of well being of a country can be found by considering the price-index, i.e The real GDP per person and not nominal GDP per person.
Answer:
The prime cost for september is $100,000.
Explanation:
prime cost = Direct material cost + Direct labour cost
= $57,000 + $43,000
= $100,000.
Therefore, the prime cost for september is $100,000.
Answer:
The current share price is $74.62.
Explanation:
The constant growth model of the DDM requires is used to estimate the fair price per share of a stock based on the expected dividends that it will pay in future when these dividends are growing at a constant rate. The formula for this model is,
Price today = D1 / r - g
Where,
D1 is the dividend in year 1
r is the required rate of return
g is the growth rate in dividends
However as the company will pay dividends from year 10. Thus, the D10 will 14.
The value of the stock at year 9 will be,
Price at year 9 = 14 / (0.125 - 0.06)
Price at year 9 = $215.38
We will discount this by the required rate of return to calculate the present value.
Present price per share = [(14 / (0.125 - 0.06)) / (1+0.125)^9]
Present prie per share = $74.617
