The investment cost of the new equipment is P385,000.00 and will have a market value of P180,000.00 at the end of a study period of eight years. Increased productivity attributable to the equipment will amount to P28,000.00 per year after extra operating costs have been subtracted from the revenue generated by the additional production. Draw the cash-flow diagram for this investment opportunity. If the firm's MARR is 21% per year, is this proposal a 4. sound one? c.Use the AW method. The new equipment cost is P106,000.00.
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Please answer C with new equipment106,000cost is
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- Amazing Airlines has the following customer metrics: Average customer relationship length: 8 years Average number of flights per customer per year: 2.5 Average cost per ticket: $600 Profit margin per customer: 8% The net CLV for Amazing Airlines is closest to? O $18,000 $960 $1260 O $12,000The All-State Mutual Fund has the following 5-year record of performance: . Find this no-load fund's 5-year (2015-2019) average annual compound rate of return. Also find its 3-year (2017-2019) average annual compound rate of return. If an investor bought the fund in 2015 at $10.00 a share and sold it 5 years later (in 2019) at $15.72, how much total profit per share would she have made over the 5-year holding period? This no-load fund's 5-year (2015-2019) average annual compound rate of return is Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) 2018 2017 Net investment income Dividends from net investment income Net realized and unrealized gains (or losses) on security transactions Distributions from realized gains Net increase (decrease) in NAV NAV at beginning of year NAV at end of year 2019 $0.98 (0.95) 4.22 (1.06) $3.19 12.53 $15.72 $0.85 (0.85) 5.08 %. (Round to two decimal places.) (1.00) $4.08 8.45 $12.53 $0.84 (0.85)…2. Two alternatives, a flexible manufacturing cell and fixed automation, have different cost and revenue characteristics as follows: Flexible Cell Fixed Automation Investment S2,500,000 б уears S800,000 in first year; increasing by $100,000 each year thereafter $300,000/year $1,500,000 3 years S800,000/year Life Gross cash savings s100,000 in the first year; decreasing to S80,000 in second year and S70,000 in third year Cash disbursement MARR 20% 20% Assuming "repeatability" and service needed for 6 years, show which alternative is preferred using the method of rate of return.
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- 3 Your company plans to raise price on product A by 5% per year. Due to competition, sales volume from product A is expected to decline at 10% per year. Revenue will be $5M for this year. Alternatively, based on the projection from the marketing department, you may reduce the sales volume decline from 10% to 5% if the price is kept unchanged. The product will be discontinued at the end of year 5 for both scenarios. If the firm's TVOM is 10%, Determine the revenue cash flow streams for both alternatives. What is the Excel financial function to compute PW of the revenue streamsLewis’s management has been considering movingto a new downtown location, and they are concerned that these plans may come to fruition priorto the equipment lease’s expiration. If the moveoccurs then Lewis would buy or lease an entirelynew set of equipment, so management wouldlike to include a cancellation clause in the leasecontract. What effect would such a clause haveon the riskiness of the lease from Lewis’s standpoint? From the lessor’s standpoint? If you werethe lessor, would you insist on changing any ofthe other lease terms if a cancellation clause wereadded? Should the cancellation clause containprovisions similar to call premiums or any restrictive covenants and/or penalties of the type contained in bond indentures? Explain your answer.3. A cement kiln with production capacity of 130 tons/day (24 hours) of clinker has its burning zone about 45 tons of magnesite chrome bricks being replaced periodically depending on some operational factors and the life of the bricks. If locally produced bricks costsP25,000/ton, and have a life of 4 months, while certain imported bricks costing P30,000/ton and have a life of 6 months, determine the more economical bricks and by how much?