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Tom [10]
3 years ago
8

Spencer Enterprises is attempting to choose among a series of new investment alternatives. The potential investment alternatives

, the net present value of the future stream of returns, the capital requirements, and the available capital funds over the next three years are summarized as follows:
Capital Requirements ($)
Alternative Net Present Value ($) Year 1 Year 2 Year 3
Limited warehouse expansion 4,000 3,000 1,000 4,000
Extensive warehouse expansion 6,000 2,500 3,500 3,500
Test market new product 10,500 6,000 4,000 5,000
Advertising campaign 4,000 2,000 1,500 1,800
Basic research 8,000 5,000 1,000 4,000
Purchase new equipment 3,000 1,000 500 900
Capital funds available 10,500 7,000 8,750

Develop an integer programming model for maximizing the net present value.

Business
1 answer:
fomenos3 years ago
4 0

Answer:

Assume: only one of the ware house expansion projects can be implemented and suppose that, if test marketing of the new product is carried out, the advertising campaign also must be conducted and vice versa. Also suppose that the purchase of new equipment cannot be undertaken unless the basic research or the extensive warehouse expansion are implemented.

Formulate the corresponding model for maximizing the net present value subject to the restrictions stated above

Yi (1 if investment alternative is selected, o otherwise)

i = 1, 2, 3, 4, 5, 6

Max Z = $4,000y1 + 6,000y2 + 10,500y3 + 4,000y4 + 8,000y5 + 3,000y6

∴ NPV = 17,500

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Four roommates are planning to spend the weekend in their dorm room watching old movies, and they are debating how many to watch
denis-greek [22]

Answer:

1. Inside the dorm room, the movies are <em>Non-Rival</em> which means that one person can watch the movie and it will not diminish the ability of others to watch as well.

Also as they are all in the same dorm, the showing of the movie is <em>Non-Excludable</em> as well because no one can stop the other from watching.

Public good is both Non-Rival and Non-Excludable so the showing of a movie IS a public good.

2.

Musashi   Sean    Bob   Eric   Total Willingness to pay

10   9   8   3   30

8   7   6   2   23

6   5   4   1   16

4   3   2   0   9

2   1   0   0   3

The optimal number of movies that can be rented is dependent on their total willingness to pay. If their Total willingness to pay for the movie is above $8 which is the cost of a movie, then they will get it. From the table, the fifth movie is below the price of $8 so they <u>should rent 4 movie</u>s.

3. If they rent 4 movies and there are 4 of them then the cost per person is;

= (8 *4)/4 people

= 24/4

= $8

This means that each roommate will pay <u>$8</u>.

3 0
3 years ago
To derive the demand curve we assume that A. marginal utility is constant. B. tastes are constant. C. prices are constant. D. re
Tems11 [23]

Answer:

C. prices are constant.

Explanation:

  • A demand is the scheduling the price of all the commodity as content and is derived as the price of the goods may changes in the future as general the demand curve is downward sloping and is shown by the equilibrium prices and movement along the curve takes place when the change in price causes the quantity demanded to change.
5 0
3 years ago
The following information is available for Zetrov Company. The cash budget for March shows an ending bank loan of $19,000 and an
Alja [10]

Answer:

Zetrov Company

Budgeted Balance Sheet for the month of March

Assets

Current assets:

Cash                                     $59,700

Accounts receivable             96,600

Inventory                                27,300   $183,600

Long-term assets:

Equipment                          $82,200

Accumulated depreciation (34,600)    $47,600

Total assets                                         $231,200

Liabilities and Equity:

Current liabilities:

Bank loan payable             $19,000

Accounts payable               90,800

Income tax payable            27,800   $137,600

Equity:

Common stock                 $34,000

Retained earnings             59,600    $93,600

Total liabilities and equity                $231,200

Explanation:

a) Data and Calculations:

Ending Bank Loan = $19,000

Ending cash balance = $59,700

Accounts receivable = $96,600 ($138,000 * 70%)

Accounts payable = $90,800

Ending inventory = $27,300 (780 * $35)

Net income = $49,800

Income tax payable = $27,800

Equipment at cost = $82,200

Accumulated depreciation, beginning $31,800

Depreciation for the month =                   2,800

Accumulated depreciation, ending =  $34,600

Retained earnings, beginning = $9,800

Net income                                  49,800

Retained earnings, ending      $59,600

6 0
2 years ago
A rich relative has bequeathed you a growing perpetuity. the first payment will occur in a year and will be $ 3 comma 000$3,000.
MAVERICK [17]
A. For knowing today's value of the bequest we need to know the period of time.
When the first payment occure and how many payments were made. 
b. Immediate value of bequest is $3,000 After one year it needto be 1.16*3,000=$3,480 Plus the second payment will be 1.04*3,000=$3,120
8 0
3 years ago
According to the equation for the Phillips curve, if nominal wages and labor productivity both increase by 3%, then the inflatio
erastova [34]

Answer:

Increases, decreases

Explanation:

According to the equation for the Phillips curve, if nominal wages and labor productivity both increase by 3%, then the inflation rate increases and unemployment decreases.

The Phillips curve is an economic concept developed by A. W. Phillips stating that <u>inflation and unemployment have a stable and inverse relationship.</u> The theory claims that <u>with economic growth comes inflation</u>, which in turn should lead to more jobs and <u>less unemployment. </u>

<u>Therefore as given in the scenario, wage increase signifies economic growth which will lead to increase in inflation and a decrease in unemployment</u>

5 0
3 years ago
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