Economics question. Please answer Asap! Will provide thumbs up!

The Shell Corporation has a 34% tax rate and owns a piece of petroleum-drilling equipment that costs $130,300 and will be depreciated at a CCA rate of 30%. Shell will lease the equipment to others and each year receive $41,300 in rent. At the end of five years, the firm will sell the equipment for $29,700. All values are presented in today's dollars.

Calculate the overall present worth of these cash flows with tax effects if market interest rate is 10% and annual inflation rate is 2%.

(Note: Don't use the $ sign in your answer and round it up to 2 decimal places)

Economics Question. Please answer ASAP! Will provide thumbs up!

Car's annual operating and maintenance (O&M) costs are given by the following schedule:

If MARR = 10%, and it is known that the value of O&M costs in the first year is the base annuity, define the value of parameter G in the equivalent arithmetic gradient series.

(Note: Don't use the $ sign in your answer and keep 2 decimal places)

13. Ann is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $3,200,000.

Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront.

Mortgage B has a 6% interest rate and requires Ann to pay zero fees upfront.

Assuming Ann makes payments for 2 years before she sells the house and pays the bank the balance, what is Ann’s annualized IRR from mortgage A?

14. Ann is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $3,200,000.

Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront.

Mortgage B has a 6% interest rate and requires Ann to pay zero fees upfront.

Assuming Ann makes payments for 2 years before she sells the house and pays the bank the balance, what is Ann’s annualized IRR from mortgage B?

15. Ann is looking for a fully amortizing 30 year Fixed Rate Mortgage with monthly payments for $3,200,000.

Mortgage A has a 4.38% interest rate and requires Ann to pay 1.5 points upfront.

Mortgage B has a 6% interest rate and requires Ann to pay zero fees upfront.

Assuming Ann makes payments for 2 years before she sells the house and pays the bank the balance, which mortgage has the lowest cost of borrowing (ie lowest annualized IRR)? Type 1 for A, type 2 for B.

You own a 10-acre vineyard and earn income by selling your grapes to wineries. Your vineyard is currently planted to Merlot grapes, but you are thinking of replanting with Syrah grapes because they are commanding a higher market price per ton. Merlot fetches $1800 per ton but Syrah sells for $2500 per ton, those prices are expected to remain stable, and you produce 5 tons per year per acre (so 50 tons per year total). Either way, you plan to sell the vineyard 5 years from now (at the end of the year) for 5-times (5x) the annual income (in year 5) from the sale of grapes (that is, you'll get the income from grape sales and then sell the vineyard for 5 times that amount at the end of year 5). However, if you switch to Syrah, it will cost you $91,000 immediately and the vines won’t produce any grapes until year 4 (that is, years 1-3 will have no sales if you plant Syrah, but years 4 and 5 will). The applicable discount rate is 12% per year. What is the NPV of switching? Round to the nearest cent. ​[Hint: Create a timeline showing the incremental annual cash flows from switching and find their NPV. Some cash flows will be negative (first 3 years) and some (years 4 and 5) will be positive.]

Explain how Lean Systems provide benefit or detriment to Operations Management globally.

David Murphy observes that a stock, Twin Inc., which is not expected to pay dividends in the next year,
is currently trading at $38.56/share. A put option with a strike price of 40 and 6-month expiration date
costs $5.15 and a call option with the same strike and expiration date is priced at $4.32 for each share
Twin's stock. The current risk-free rate is 0.2% per month. After checking the prices with the put-call
parity, David decides to take an arbitrage opportunity by

A. Taking short positions in the call option and the underlying stock and holding long
positions in the risk-free zero-coupon bond with a par of $40 and in the put option.
B. Taking short positions in the put option and the underlying stock and holding long
positions in the risk-free zero-coupon bond with a par of $40 and in the call option.
C. Taking long positions in the call option and the underlying stock and holding short
positions in the risk-free zero-coupon bond with a par of $40 and in the put option.
D. Taking long positions in the put option and the underlying stock and holding short
positions in the risk-free zero-coupon bond with a par of $40 and in the call option.

Bond X is a premium bond making semiannual payments. The bond has a coupon rate of 7.5%, a YTM of 6%, and 13 years to maturity. Bond Y is a discounted bond making semiannual payments. This bond has a coupon rate of 6%, a YTM of 7.5%, and also 13 years to maturity. What are the prices of these bonds today assuming both bonds have a $1,000 par value? If interest rates remain unchanged, what do you expect the prices of these bonds to be in 1 year? In 3 years? In 8 years? In 12 years? In 13 years? What's going on here? Illustrate your answers by graphing bond prices versus time to maturity.

You consider a new piece of equipment that will cost $400,000, and will require $20,000 for shipping and installation. NWC will increase immediately by $25,000. The project will last 3 years and the equipment has a 5 year class life. Revenues will increase by $220,000/year, and defect costs will decrease by $220,000/year. Operating costs will increase by $30,000/year. The market value of the equipment after year 3 is $200,000. The cost of capital is 12%; marginal tax rate is 30%. What is the NPV?

You are the CFO of a small technology firm. It is difficult for you to raise money from a bank or from other investors, and you only have a limited amount of cash. As long as you apply the NPV rule, you will maximize the returns to your investors.

All calculations are Semi Annual!! ABC Inc. has three different types of bonds outstanding. Bond X carries a 6.25% coupon and has 8 years to maturity, Bond Y is a zero coupon bond also with 8 years to maturity, and Bond Z is a 6.25% coupon bond with 15 years to maturity. All three bonds currently have a YTM =10%. 1.What is today’s market price for Bond X? Bond Y? Bond Z? 2.What is the true annualized yield of Bond X? Of Bond Y? Of Bond Z? (i.e., find their EARs) 3.Suppose interest rates suddenly drop, such that the yield on all three bonds declines by 200 basis points. What is the new price for each of these bonds? What is the percentage change in price of the three bonds? Explain why the percentage change in the price of Bond X is different than that of the other two bonds. 4.Suppose in the previous problem that yields increase by 200 basis points instead. Without performing any calculations, do you expect the percentage price change in the bonds to be of greater or lesser magnitude than what you calculated in problem #3? Why? What principle lies behind your answer? 5. Suppose you decide to sell Bond X 4 years from now for $880.00. What is your HPY? When you first bought the bond 4 years ago, what did you expect would to be its year 4 price?

You are the CFO and are considering introducing a new product that will require an initial investment in equipment of $6 million. The equipment will be depreciated straight line over 3 years to a value of zero, and can be sold after 3 years for $500,000. Working capital at each date must be maintained at a level of 10% of the following year’s forecast sales. You estimate production costs at $1.50 /unit and the sales price at $4/unit. Sales forecasts are given in the following table. The tax rate is 35%, and the discount rate is 12%. What is the project NPV?

An amount of $2400 was borrowed at 12% on March 1, 2016. Payments of $800 were made on May 1st, August 1st, and October 1st. Determine the amount needed to repay the loan on December 1st using:

1) the Merchant's Rule AND 2) the U.S. Rule.

Really looking for help on how to compute them and the formulas required. Thanks!