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liraira [26]
3 years ago
11

Panelli's is analyzing a project with an initial cost of $139,000 and cash inflows of $74,000 in Year 1 and $86,000 in Year 2. T

his project is an extension of current operations and thus is equally as risky as the current company. The company uses only debt and common stock to finance its operations and maintains a debt-equity ratio of .39 The aftertax cost of debt is 5.1 percent, the cost of equity is 13.2 percent, and the tax rate is 21 percent. What is the projected net present value of this project
Business
1 answer:
nikklg [1K]3 years ago
4 0

Answer:

The projected net present value of this project is -$2,386

Explanation:

In order to calculate the projected net present value of this project First we have to calculate the WACC of the firm as follows:

WACC=[(Weight of common stock*Corresponding cost)+(Weight of debt *Corresponding cost)[cost of debt is after tax)]/Total weight

WACC=[(1.0*0.132)+(0.39*0.051)]/1.39

WACC=10.92%(approx)

NPV=Present value of cash inflows-Initial Investmet

Therefore, NPV={[$74,000/(1.1092)]+[$86,000/(1.1092)∧2]}-$139,000

NPV=$66,714+$69,900-$139,000

NPV=-$2,386

The projected net present value of this project is -$2,386

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andrew-mc [135]

Answer:

His conclusion is based on his own soul-interest.

Explanation:

In the following situation, Ayden is a sole Proprietor he has no team or management system to discuss the idea of opening a new shop, Ayden has to decide about his all expenses, revenues, sources of finance and decision cost from his knowledge and experience.

  • Ayden is behaving rationally because he is fully liable for his decisions.
7 0
3 years ago
A common carrier bailee generally would avoid liability for loss of goods entrusted to its care if the goods area. Stolen by an
larisa86 [58]

Answer:

The correct answer is letter "D": Improperly packed by the party shipping them.

Explanation:

Carriers are liable for the loss of goods being transported by them under three scenarios: acts of God (<em>because they are unpredictable</em>), acts of the shipper (<em>negligence of the person providing with the goods being transported</em>), and acts of a public enemy (<em>a country engaging into the war</em>).

In that case, <em>the carrier is likely not to be found liable if the shipping items were incorrectly packaged the sending party</em>.

8 0
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Suppose that an economy's labor productivity fell by 3 percent and its total worker-hours remained constant between year 1 and y
11111nata11111 [884]

Answer: 1. real GDP declined.

Explanation:

If labor productivity fell yet the workforce did not increase, that means that for Years 1 and 2, workers were producing less than they were producing before because the same number of people were producing.

This means that the amount of goods produced in the country would reduce and therefore GDP would reduce as well as GDP is the amount of goods and services produced in a country. If labor productivity had fallen yet the work-hours had increased, the increase in worker hours would have made up for the loss of labor productivity.

6 0
3 years ago
You need some money today and the only friend you have that has any is your ‘miserly' friend. He agrees to loan you the money yo
Bingel [31]

Answer:

B. The total interest = $4.35

Explanation:

The first question to answer, is  what is the present value of the annuity of the loan and then based on that the total interest can be calculated.

<h2>Present value of annuity= A x [(1-(1+r)-n)/r]*(1+r) </h2>

Where the A represents Annuity = or $20

The r represents the rate or 1.5%

and the n represents the number of periods which is 6 months

Calculating the value =

= 20 x [(1-1.015^-6)/0.015]*1.015

= 20 x [(1-0.91454219251)/0.015]*1.015

= 20*5.782644973

=$115.65

Now that the loan amount is known, the Total Interest can be calculated as follows

Total Interest= number of payments x monthly payments) - the loan amount (calculated above)

= 20 x 6 -115.65

= 120-115.65

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8 0
3 years ago
While Sony and Microsoft focused on the graphics and raw processing power favored by hard-core male gamers, Nintendo chose to de
nirvana33 [79]

Answer:

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Blue ocean is a strategy that says innovation, simultaneous pursuit, and low cost are key concepts to achieve a successful business and establish an advantage in the market. It is a very proactive system that allows the constant improvement, elimination, reduction, and creation of corporate actions. It is a global and general perspective that allows the management team to know the state of the company at any time.

4 0
3 years ago
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