If a project costs $120,000 and is expected to return $29,000 annually, how long does it take to recover the initial investment? What would be the discounted payback period at /= 16%? Assume that the cash flows occur continuously throughout the year. The payback period is years. (Round to one decimal place.)
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- An integrated, combined cycle power plant produces 290 MW of electricity by gasifying coal. The capital investment for the plant is $530 million, spread evenly over two years. The operating life of the plant is expected to be 15 years. Additionally, the plant will operate at full capacity 74% of the time (downtime is 26% of any given year). The MARR is 5% per year. a. If this plant will make a profit of three cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant? Is it a low-risk venture? b. What is the IRR for the plant? Is it profitable?An integrated, combined cycle power plant produces 295 MW of electricity by gasifying coal. The capital investment for the plant is $450 million, spread evenly over two years. The operating life of the plant is expected to be 15 years. Additionally, the plant will operate at full capacity 72% of the time (downtime is 28% of any given year). The MARR is 8% per year. a. If this plant will make a profit of two cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant? Is it a low-risk venture? b. What is the IRR for the plant? Is it profitable? a. The simple payback period of the plant is 12.1 years. (Round up to one decimal place.) It's a high-risk venture. b. The IRR for the plant is %. (Round to one decimal place.)An integrated, combined cycle power plant produces 280 MW of electricity by gasifying coal. The capital investment for the plant is $460 million, spread evenly over two years. The operating life of the plant is expected to be 25 years. Additionally, the plant will operate at full capacity 77% of the time (downtime is 23% of any given year). The MARR is 8% per year. a. If this plant will make a profit of two cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant? Is it a low-risk venture? b. What is the IRR for the plant? Is it profitable? a. The simple payback period of the plant is years. (Round up to one decimal place.) It's a venture. b. The IRR for the plant is %. (Round to one decimal place.) The plant is
- (a) How much will the firm produce in order to maximise profits at a price of £8 per unit and What will be its average cost of production at this output? ..................................................... (b) How much (supernormal) profit will it make and How much will the firm produce in order to maximise profits at a price of £5 per unit? . (c) Below what price would the firm shut down in the short run and Below what price would the firm shut down in the long run?An integrated, combined cycle power plant produces 285 MW of electricity by gasifying coal. The capital investment for the plant is $530 million, spread evenly over two years. The operating life of the plant is expected to be 18 years. Additionally, the plant will operate at full capacity 76% of the time (downtime is 24% of any given year). The MARR is 7% per year. a. If this plant will make a profit of two cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant? Is it a low-risk venture? b. What is the IRR for the plant? Is it profitable? a. The simple payback period of the plant is 14 years. (Round up to one decimal place.) It's a high-risk venture. b. The IRR for the plant is %. (Round to one decimal place.) CHEAn integrated, combined cycle power plant produces 285 MW of electricity by gasifying coal. The capital investment for the plant is $700 million, spread evenly over two years. The operating life of the plant is expected to be 15 years. Additionally, the plant will operate at full capacity 77% of the time (downtime is 23% of any given year). The MARR is 7% per year. a. If this plant will make a profit of three cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant?.
- Determine the IRR for an equipment that costs $250,000 and would provide positive cash flows of $100,000, $90,000, $80,000, and $20,000 at the end of each year for the next four years. (Try i = 7% &i=8%) 9.75% 7.53% 10.90% 9.38%Other Shoe Company has been selling 256,000 units of sandals each year at a selling price of $37.50 per pair. Contemplating increases in variable cost and in selling price, the company calculates percent profit breakeven at -10.5%. If Other Shoe just breaks even on the changes in price and variable cost, how many total units of sandals will the company sell per year after the changes? (Rounding: whole unit.)Jumbo Company uses 1,100 units of an particular item each year. Carrying the item in inventory costs $200 per unit per year. It costs $150 for each order of the chemical. The firm uses the item at a constant rate each year. Calculate the Economic Order Quantity AND Use the data from problem above and assume that Jumbo Company operates 250 days per year. Also assume that its total usage is 1,100 units per year. There is a lead time of 2 days and Jumbo desires to keep a safety stock of 4 units. Calculate the reorder point
- a- Given the pay-off table below showing the profit (present value Rs.), a firm might expect in a foreign country for three alternative factory investments (X, Y, and Z) under different levels of inflation. Economists have assigned probabilities of 0.2, 0.3, 0.4, and 0.1 to the possible inflation levels A, B, C and D, respectively. Find the preferred investment alternative using criteria of (a) Maximin, (b) Laplace, (c) Maximum probability, and (d) Expected monetary value. Finally, (e) Use your "judgment" (Write your own point of view based on your јudgment). States of nature: amount of inflation A B C D Build factory X 10 Build factory Y 40 Build factory Z 10 30 50 120 50 60 70 40 80 10The Allianz Company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Relevant ordering costs per purchase order $520 Relevant carrying costs per year for each product: Required annual return on investment 16% Required other costs per year $9 Annual demand is 32,000 prroducts per year. The purchase price per product is $51.What is the economic order quantity?A project has an upfront cost (1-0) of $10,000, and it produces annual FCF of $3,000/year from 1-1 through t-7 (seven years). As you can calculate, the net present value of this project, as a stand alone project, without considering inflation, and using a discount rate of 10.0 percent, is $4.605.26. The firm intends to replicate this project out to infinity every seven years, and expects annual inflation to be 4.0 percent for the cash outflows, and 3.0 percent for the cash inflows. That is, the expected cost in Year 7 of replicating this project will be ($10,000) (104) = $13.159.32, and the expected cash inflow in Year 1 will be ($3.000) (1.03)¹ = $3.090. in Year 2 will be ($3.000) (1.03)² $3,182.70, etc. Given this information, and assuming the discount rate remains the same, determine the net present value of this project if it is infinitely replicated and inflation is taken into consideration. $11.315 O $15.804 $9,626 O $8.206 =