Question
In: Finance
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $46,000....
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $46,000. The object is to save on horse transporter rentals. Marsha had been renting a transporter every other week for $211 per week plus $1.55 per mile. Most of the trips are 90 miles in total. Marsha usually gives the driver a $45 tip. With the new transporter she will only have to pay for diesel fuel and maintenance, at about $.56 per mile. Insurance costs for Marsha’s transporter are $1,750 per year. The transporter will probably be worth $26,000 (in real terms) after eight years, when Marsha’s horse Nike will be ready to retire. Assume a nominal discount rate of 7% and a forecasted inflation rate of 2%. Marsha’s transporter is a personal outlay, not a business or financial investment, so taxes can be ignored. Hint: All numbers given in the questions are in real terms. Assume CF at end of year, for simplicity. Calculate the NPV of the investment.
Solutions
jeff jeffy answered 1 year agoRelated Solutions
. Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost...
. Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $35,000. The object is to save on
horse transporter rentals. Marsh had been renting a transporter
every other week for $200 per day plus $1.00 per mile. Most of the
trips are 80 or 100 miles in total. Marsha usually gives her
driver, Joe Laminitis, a $40 tip. With the new transporter she will
only have to pay for diesel fuel and maintenance, at...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $50,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $50,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $215 per
day plus $1.75 per mile. Most of the trips are 80 or 100 miles in
total. Marsha usually gives Joe Laminitis, the driver, a $40 tip.
With the new transporter she will only have to pay for diesel fuel
and maintenance, at about...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $35,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $35,000. The object is to save on
horse transporter rentals. Marsh had been renting a transporter
every other week for $200 per day plus $1.00 per mile. Most of the
trips are 80 or 100 miles in total. Marsha usually gives her
driver, Joe Laminitis, a $40 tip. With the new transporter she will
only have to pay for diesel fuel and maintenance, at about...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $36,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $36,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $201 per
day plus $1.05 per mile. Most of the trips are 80 or 100 miles in
total. Marsha usually gives Joe Laminitis, the driver, a $45 tip.
With the new transporter she will only have to pay for diesel fuel
and maintenance, at about...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $35,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $35,000. The object is to save on
horse transporter rentals. Marsh had been renting a transporter
every other week for $200 per day plus $1.00 per mile. Most of the
trips are 80 or 100 miles in total. Marsha usually gives her
driver, Joe Laminitis, a $40 tip. With the new transporter she will
only have to pay for diesel fuel and maintenance, at about...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $36,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $36,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $201
per week plus $1.05 per mile. Most of the trips are 90 miles in
total. Marsha usually gives the driver a $45 tip. With the new
transporter she will only have to pay for diesel fuel and
maintenance, at about $.46 per mile. Insurance...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $50,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $50,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $215
per week plus $1.75 per mile. Most of the trips are 90 miles in
total. Marsha usually gives the driver a $40 tip. With the new
transporter she will only have to pay for diesel fuel and
maintenance, at about $.60 per mile. Insurance...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $41,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $41,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $206
per week plus $1.30 per mile. Most of the trips are 90 miles in
total. Marsha usually gives the driver a $45 tip. With the new
transporter she will only have to pay for diesel fuel and
maintenance, at about $.51 per mile. Insurance...
Marsha Jones has bought a used Mercedes horse transporter for her Connecticut estate. It cost $47,000....
Marsha Jones has bought a used Mercedes horse transporter for
her Connecticut estate. It cost $47,000. The object is to save on
horse transporter rentals.
Marsha had been renting a transporter every other week for $212
per week plus $1.60 per mile. Most of the trips are 90 miles in
total. Marsha usually gives the driver a $50 tip. With the new
transporter she will only have to pay for diesel fuel and
maintenance, at about $.57 per mile. Insurance...
In 2018, Grace - bought a used car for her personal use for RM50,000; - and...
In 2018, Grace
- bought a used car for her personal use for RM50,000;
- and spent RM8,000 on new car parts made in Malaysia.
For each of the two transactions above, explain how the
components of GDP and the total GDP in 2018 are affected. What is
the combined effect of these two transactions on Malaysian GDP in
2018?
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