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lyudmila [28]
3 years ago
15

(Ignore income taxes in this problem.) Henscheid Roofing is considering the purchase of a crane that would cost $104,972, would

have a useful life of 7 years, and would have no salvage value. The use of the crane would result in labor savings of $23,000 per year. The internal rate of return on the investment in the crane is closest to:
Business
1 answer:
shutvik [7]3 years ago
3 0

Answer:

IRR is 12%

Explanation:

The internal rate of return on the investment can be computed using the IRR formula in excel:

=IRR(values)

The values are the cash flows for the relevant years arranged as shown below:

Years   Cash flows

0             -$104,972

1                $23,000

2               $23,000

3               $23,000

4               $23,000

5               $23,000

6                $23,000

7                $23,000

=irr(values from -$104,972-$23,000 in year 7)

irr=12%

Kindly find attached excel with the computation of IRR as well

The internal rate of return is the rate of return on investment where present value of cash inflows equal the initial investment

Download xlsx
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Consider the following three bond quotes; a Treasury note quoted at 87.25, and a corporate bond quoted at 102.42, and a municipa
r-ruslan [8.4K]

Answer:

              Total market value of the bonds:  6,972.2

Explanation:

The "quote" will be the percent of the face value at which the title is currently  trading.

We will multiply each quoted by the face value to get the market value in dollars:

1,000 x  87.25/100     =     875.5

1,000 x 102.42/100    =   1,024.2

5,000 x 101.45/100    =   5,072.5

              Total             =  6,972.2

6 0
4 years ago
The cost, in dollars, to produce x designer dog leashes is C ( x ) = 8 x + 3 , and the price-demand function, in dollars per lea
steposvetlana [31]

Answer:

<em><u>P (x)   = 80x - 2x^2 - 3</u></em>

Explanation:

The Profit function is the revenue minus the cost.

Revenue = Price x Quantity =  X.px = x(88-2x) = 88x - 2x^2

Therefore the profit function P (x):  

P (x)  =  88x - 2x^2 - (8x+3)

<em><u>P (x)   = 80x - 2x^2 - 3</u></em>

<em><u /></em>

To maximise profit we use the 1st order condition: dP(x)/dq = 0

Therefore,  80 - 4x = 0

4x = 80

x = 20

So 20 leashes maximises profit.

P(x) = 80(20) - 2(20)^2 - 3

<em><u> P = $803  </u></em>

<em><u /></em>

The price to charge would be:

<u><em>p (x) = 88 - 2(20) = $48</em></u>

<u><em>The best reason would be that the price is a bit expensive for a leash so most people would not buy it.</em></u>

6 0
3 years ago
An underpriced stock provides an expected return that is __________ the required return based on the capital asset pricing model
8_murik_8 [283]

An underpriced stock provides an expected return that is less than the required return based on the capital asset pricing model (CAPM).

<h3>What is capital asset pricing model?</h3>

The capital asset pricing model (CAPM)  is a tool that helps to show how financial markets price securities is moving and help to  determine expected returns on capital investments.

In this case, An underpriced stock provides an expected return that is less than the required return based on the capital asset pricing model (CAPM).

Learn more about capital asset pricing model  at:

brainly.com/question/17219340

#SPJ1

3 0
2 years ago
1. Russell's of Townville needs to borrow $48,000 for one year. The bank requires a 10 percent compensating balance on any amoun
babunello [35]

Answer:

D. 10.0%

Explanation:

As the bank reqiresd 10% compensating balance the actual amount unrestricted for the loan is 48,000 x (1 - 10%) = 43,200

and from this amount we have to solve for the effective rate:

principal x rate = interest

48,000 x 0.09 = 4,320

now we divide the interest over the actual principal to know the effective rate:

4,320 / 43,200 = 0.10 = 10%

8 0
3 years ago
"At DoubleTalk, Inc., Joe, a supervisor, pushes his employees' performance by constantly checking their work and threatening the
LUCKY_DIMON [66]

Answer:

Assertiveness

Explanation:

Assertiveness involves expressing and maintaining one's own views or position and <u>trying to influence others to act according to such a position.</u>

By pushing the employee's to perform in a certain way, Joe is being assertive.

5 0
4 years ago
Read 2 more answers
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