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Finger [1]
2 years ago
7

Machines A and B are mutually exclusive and have the following investment and operating costs. Machine A has a life of 3 years w

hile Machine B has a 2 year life. Year: 0 1 2 3 A $5,000 $800 $900 $1,000 B $6,000 $850 $900 -- Assume the discount rate is 9 percent. The equivalent annual annuity of machine A is ______. The equivalent annual annuity of machine B is ______.
Business
1 answer:
olganol [36]2 years ago
3 0

Answer:

$-1081.01

$-2536.89

Explanation:

Equivalent annual cost method is a capital budgeting method used to choose between two projects with an unequal life span

The decision rule is to choose the product with the higher Equivalent annual cost

Equivalent annual annuity method is better for making this decision because if net present value is used, the project with the higher useful life would be chosen. this does not mean it is more profitable

EAA = \frac{r(NPV)}{1 - \frac{1}{(1+ r)^{n} } }

Net present value is the present value of after-tax cash flows from an investment less the amount invested.  

NPV can be calculated using a financial calculator

Machine A

Cash flow in year 0 = - $5,000

Cash flow in year 1 =  $800

Cash flow in year 2 =  $900

Cash flow in year 3 =  $1,000  

I = 9%

NPV A = -2736.35

Machine B

Cash flow in year 0 = -$6,000

Cash flow in year 1 = $850

Cash flow in year 2 = $900

I = 9%

NPV B = -4462.67

EAA =

(0.09 x -2736.35) / ( 1 - (1.09)^3) = $-1081.01

(0.09 x -4462.67) / ( 1 - (1.09)^2)= $-2536.89

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Tasya [4]

Answer:

The correct answer is: D. Marketing information system.

Explanation:

Modern marketing requires more dynamic and intelligent information systems every day. The real-time information for decision making every day becomes more relevant. Focusing marketing strategies on the knowledge of customers and markets, requires having antennas placed on the market and multi-source data collection systems that allow anticipating market trends and thus making smarter decisions. Technology, Big Data and artificial intelligence are changing the rules of the Information Systems game.

The Marketing Information System and the digitalization of processes go hand in hand, allowing companies to use technology as a tool for making timely decisions for the market.

8 0
3 years ago
PLEASE ive been asking for days i need help with this i don't understand it
timama [110]

Answer:

$47

Explanation:

Because she can afford the 144 bushel plan, in the long run it is cheaper per bushel so you would choose to market that one to her because it is cheaper in the long run for as well as she grows more bushels.

8 0
3 years ago
What quality-related trade-offs might there be between having a single large, centralized production processing facility and hav
trasher [3.6K]

Answer:

Centralized production processing facility considers top management as the apex of decision making.

In decentralized production processing the decision making is delegated to teams and multiple individuals.

Explanation:

Centralized facility:

Pros:

a. In centralized facility top management commitment helps in improved decision making

b. Allocation of budgets to improve production processes.

c. The process becomes a part of strategic planning.

d. Standardization of processes like Mcdonalds kitchen.

e. Lower costs

f. Better forecasting

Cons:

a. Lack of flexibility

b. In case of international chains customers may be dissatisfied with standardized procedures

c. No room for customization

Decentralized Facility:

Pros:

a. Flexibility

b. Customer oriented approach

c. lack of bureaucratic procedure

d. quick decision making

Cons:

a. No standardization

b. Every Team has its own benchmarking process to evaluate performance.

c. Costly

d. Planning, budgeting and forecasting is effected adversely.

3 0
3 years ago
Using the one-period valuation model, assuming a year-end dividend of $0.11, an expected stock sales price of $60, and a require
sineoko [7]

Solution:

The most common tool used to measure the valuation of the stock is the ratio of price to earnings. It's easy to access, and the data is readily accessible. The P / E ratio is determined by measuring the price of the stock by the sum of its 12-month trailing profits.

Given,

Dividend of $0.11

Expected stock sales price of $60

RRR 10%

The current price of the stock would be : 60 * 0.10 * 0.11 = 66

7 0
2 years ago
A firm uses a continuous review (Q) inventory system. Weekly demand for a product is normally distributed with a mean of 120 uni
Sidana [21]

Answer: 90.32%

Explanation:

Weekly demand (d) = 120

Standard deviation = 10

Lead time (l) = 4

Reorder point = 506

The reorder point is calculated as:

506 = 120 × 4 + Z × 10 × ✓4

Solving for Z will give us 1.3

Then, we check this in the z table which will give us p = 0.9032

Therefore, the service level is 90.32%.

8 0
3 years ago
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