1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
chubhunter [2.5K]
3 years ago
9

Empire Industries is considering adding a new product to its lineup. This product is expected to generate sales for four years a

fter which time the product will be discontinued. What is the project's net present value if the firm wants to earn a 13 percent rate of return?
Year. Cash Flow
0 --- -62,000
1 --- 16.500
2 --- 23,800
3 --- 27,100
4 --- 23,300

a. $3,505.52
b. $3,767.24
c. $4,312.65
d. $4,519.58
e. $4,902.71
Business
2 answers:
Andreyy893 years ago
7 0

Answer:

The project's net present value if the firm wants to earn a 13 percent rate of return is c. $4,312.65

Explanation:

The Net Present Value of a Project is Calculated by Taking the Present Day (Discounted) Value of All future Net Cashflows based on the <em>Business Cost of Capital</em> and <em>Subtracting</em> the initial Cost of the Investment.

Using A Financial Calculator Cf Function:

Cf0 = -62,000

Cf1 =   16.500

Cf2 =  23,800

Cf3 =  27,100

Cf4 =  23,300

IRR = 13 %

NPV = 4,312.65

shepuryov [24]3 years ago
7 0

Answer: C. $4,312.65

Explanation:

Given the following;

Cashflow :

Year 0 --- -62,000

Year 1 --- 16,500

Year 2 --- 23,800

Year 3 --- 27,100

Year 4 --- 23,300

Net present value(NPV)

Internal Rate of Return(IRR) = 13% = 0.13

Using the formula ;

NPV = year 0 + (year 1 ÷ (1+IRR)) + (year 2 ÷ (1+IRR)^2) + (year 3 ÷ (1+IRR)^3) + (year 4 ÷ (1+IRR)^4)

NPV = - $62,000 + ($16,500 ÷ (1.13)) + ($23,000 ÷ (1.13)^2) + ($27,100 ÷ (1.13)^3) + ($23,300 ÷ (1.13)^4)

NPV = -$62,000 + $14,601.77 + $18,638.89 + $18,781.66 + $14,290.33 = $4,312.65

You might be interested in
Ms. Marilynn Castillo is a marketing manager at Gordon Corp. She debates whether or not to conduct a marketing research study be
Ipatiy [6.2K]

Answer:

The correct answer is letter "B": cost-benefit assessment.

Explanation:

Cost-benefit assessment implies analyzing what the costs and benefits of engaging in business are. The approach aims to minimize losses and maximize benefits. It does not necessarily imply there are not going to be losses during the business cycle but could reduce them as much as possible.

3 0
3 years ago
You want to buy an Audi A8 7 years from now. You have priced these cars and found that they currently sell for $83,800. You beli
lana [24]

Answer:

We to invest <em> $ 17,213 per year to buy the car in  seven years from now</em>

Explanation:

<u><em>First, we solve for the future value of the car:</em></u>

Principal \: (1+ r)^{time} = Amount

Principal 83,800.00

time 7.00

rate 0.10000

83800 \: (1+ 0.1)^{7} = Amount

Amount 163,302.49

<u><em>Then, for the PTM to achieve tham amount in 7 years:</em></u>

FV \div \frac{(1+r)^{time} -1}{rate} = C\\

FV 163,302

time 7

rate 0.1

163302.49298 \div \frac{(1+0.1)^{7} -1 }{0.1} = C\\

<em>C  $ 17,212.981 </em>

8 0
3 years ago
Under its executive stock option plan, W Corporation granted options on January 1, 2021, that permit executives to purchase 15 m
stiv31 [10]

Answer:

$270m

Explanation:

We can calculate the amount that will increase W's shareholder's equity when the options are exercised as follows

Increase in equity =  No Options Granted x Exercise price at the date of grant

Increase in equity = 15million x $18  

Increase in equity = $270m

       

5 0
3 years ago
Michaels plumbing purchased a used van for $3,250. the company made a down payment of $450 and agrees to 24 payments of $150 per
PolarNik [594]
<span> <span>Finance charge can be defined as the amount charged by a creditor to a debtor as borrowing fees or by a seller to a buyer for allowing the buyer to extend the payment period for a certain good/service. In this case, the original price of the car was $3,250. But since Michael's Plumbing was not able to pay the full amount at once, they made a down payment of $450 and later 24 equal installments of $150. In total, the amount paid will be (450+(150*24))= $4,050. The finance charge is what they will pay over and above the initial cash price. This is arrived at by getting the difference as follows $4,050-$3,250= $800</span></span>
7 0
3 years ago
mike has $200 in his wallet. He pays a cell phone bill of $89.50. Then he earns $125 shoveling driveways. From mike lends $15 to
denis23 [38]

Answer:

$240.50

Explanation:

200-89.50 = 110.50

110.50+125 = 235.50

235.50-15 = 220.50

220.50 + 20 = 240.50

8 0
2 years ago
Other questions:
  • Sandra wilson is paid one and one-half times the regular hourly rate for all hours worked in excess of 40 hours per week and dou
    5·1 answer
  • At a price of $4 per unit, Gadgets Inc. is willing to supply 20,000 gadgets, while United Gadgets is willing to supply 10,000 ga
    7·1 answer
  • Ruth is a mother of two, loves to travel, is a member of a book club, enjoys jogging, likes to wear the latest fashions, and is
    13·1 answer
  • Suppose that in 2011, per-person GDP in Singapore was $53,591, and in Egypt, it was $5,547, as measured in 2005 purchasing power
    12·1 answer
  • Average Common Stockholders' Equity, Return on Stockholders' Equity Rebert Inc. showed the following balances for last year: Jan
    11·1 answer
  • Your task is to design a rectangular industrial warehouse consisting of three separate spaces of equal size. The wall materials
    11·1 answer
  • ____________________ was a major reason why the United States changed more towards a mixed market economy.
    11·1 answer
  • Trent Co. reports the following information: Net cash provided by operating activities $430,000 Average current liabilities 300,
    13·1 answer
  • If workers are more educated, then short-run aggregate supply ___________.
    11·1 answer
  • For kodak film inc. , the advent of digital technology can best be described as what type of innovation?.
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!