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alexgriva [62]
3 years ago
12

A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would

cause significant harm to a nearby river. The firm could spend an additional $11 million at Year 0 to mitigate the environmental Problem, but it would not be required to do so. Developing the mine (without mitigation) would cost $69 million, and the expected net cash inflows would be $23 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be $24 million. The risk adjusted WACC is 14%.
1. Calculate the NPV and IRR with mitigation. Round your answers to two decimal places. Enter your answer for NPV in millions.
2. Calculate the NPV and IRR without mitigation. Round your answers to two decimal places. Enter your answer for NPV in millions.
Business
1 answer:
m_a_m_a [10]3 years ago
5 0

Answer:

1. Calculate the NPV and IRR with mitigation. Round your answers to two decimal places. Enter your answer for NPV in millions.

  • NPV = $2.39 million
  • IRR = 15.24%

2. Calculate the NPV and IRR without mitigation. Round your answers to two decimal places. Enter your answer for NPV in millions.

  • NPV = $9.96 million
  • IRR = 19.86%

Explanation:

1) initial cost $80 million

expected cash flows $24 during the next 5 years

WACC = 14%

using a financial calculator (or excel spreadsheet),

NPV = $2.39 million

IRR = 15.24%

2) initial cost $69 million

expected cash flows $23 during the next 5 years

WACC = 14%

using a financial calculator (or excel spreadsheet),

NPV = $9.96 million

IRR = 19.86%

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One argument for the idea that customer demands for local customization are on the decline worldwide is that
PolarNik [594]

Answer: customer tastes have converged worldwide.

Explanation:

The options to the question are:

A. governments across the world are standardizing their legal procedures.

B. customer tastes have converged worldwide.

C. high costs of local customization are deterring companies from doing so.

D. managers worldwide ignore the differences in consumer tastes and preferences.

E. local and indigenous industries are increasingly filling up available demand

Local customisation is simply the implementation of creative ideas with a particular brand. argument for the idea that customer demands for local customization are on the decline worldwide is that customer tastes have converged worldwide.

8 0
3 years ago
A study by carnegie mellon university showed that drivers talking on cell phones can miss seeing ......% of their driving enviro
vazorg [7]

(Strayer, D. L. 2007), A study by Carnegie Mellon University showed that drivers talking on cell phones can miss seeing<u> 50 % </u>of their driving environment, including pedestrians and green lights.

<h3>What are the risks of using cell phones while driving?</h3>

There are studies, which have found that drivers who use cell phones while driving are more likely to face accidents resulting in injuries and there is a correlation that exists between phone use and accountability for crashes.

Therefore, (Strayer, D. L. 2007), A study by Carnegie Mellon University showed that drivers talking on cell phones can miss seeing<u> 50 % </u>of their driving environment, including pedestrians and green lights.

learn more about risks of cell phones:

brainly.com/question/4733015

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5 0
2 years ago
Kluber, Inc. had net income of $917,000 based on variable costing. Beginning and ending inventories were 56,700 units and 55,400
Nana76 [90]

Answer:

The answer is "\$235,410".

Explanation:

Variable cost net income =\$917,000

Less: Fixed overhead start  56,700\times \$2.10=\$119,070

Add: Fixed overhead termination  55,400\times $2.10=\$11,6340

Net revenue at cost of absorption =\$235,410

3 0
3 years ago
A company is planning to purchase a machine that will cost $24,000 with a six-year life and no salvage value. The company expect
Artyom0805 [142]

Answer:

The correct option is 4 years

Explanation:

Payback period is the length of time it takes an investment to repay itself.By repaying itself I meant the time horizon taken for the initial capital outlay from a project to be recovered.

Payback period=initial investment /net annual cash inflow

initial investment is the $24,000 spent in acquiring the new machine

net annual cash flow =net income+depreciation

depreciation is added because it is not a cash flow in real  sense

net annual cash flow=$2000+$4000=$6000

payback period=$24,000/$6000= 4 years

6 0
3 years ago
Select the sentence that is completely correct. Three dates are scheduled for the seminar called "E-Commerce Today:" April 1, Ma
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Answer:

Three dates are scheduled for the seminar called "E-Commerce Today": April 1, May 3, and June 5.

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The standard rule is that colon goes outside the quotation marks while commas and period goes inside.

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4 0
4 years ago
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