Question

In: Economics

Suppose the MARR is 5%. Use the following table to answer the question--The IRR on the...

Suppose the MARR is 5%. Use the following table to answer the question--The IRR on the CMS Investment is _______. CMS FMS Initial Investment $31,000 $38,000 Annual Revenue 6,688 9,102 Useful Life (Years) 5 5 A. 17.0% - 18.0% B. 5.0% - 6.0% C. 20.0% - 21.0% D. 2.0% - 3.0% E. 11.0% - 12.0%

Solutions

Expert Solution


Related Solutions

Suppose the MARR is 12%. Use the following table to answer the question--Which option should be...
Suppose the MARR is 12%. Use the following table to answer the question--Which option should be selected as the challenger alternative? CMS FMS Initial Investment $20,000 $29,000 Annual Revenue 6,688 9,102 Useful Life (Years) 5 5 A. CMS B. Both options are acceptable challenger alternatives. C. I'm completely lost! D. Neither option is acceptable as a challenger alternative. E. FMS
Question 5 (4 marks) Simple Calculation Use the information in the following table to answer the...
Question 5 Simple Calculation Use the information in the following table to answer the question. Note the fund started with 100 Net Asset Value at the start of 2012. 2012 2013 2014 2015 2016 2017 2018 2019 Return 8.0% 4.0% 1.7% -4.5% 9.7% 10.7% -0.3% -14.1% Asset Value 108.00 112.36 114.27 109.18 119.82 132.64 132.27 113.64 Given the above hedge fund manager’s performance, which year(s) would the manager get paid on their high water mark? (1.5 marks). Calculate the rolling...
Use the information in the following table to answer the question. Note the fund started with...
Use the information in the following table to answer the question. Note the fund started with 100 Net Asset Value at the start of 2012. 2012 2013 2014 2015 2016 2017 2018 2019 Return 7.7% 10.4% 21.9% -2.2% 24.8% -20.5% 12.8% 7.7% Asset Value 107.67 118.83 144.83 141.67 176.83 140.50 158.50 170.67 1)Given the above hedge fund manager’s performance, which year(s) would the manager get paid on their high watermark? 2)Calculate the rolling 3 years' average returns and identify which...
Use the information in the following table to answer the question. Note the fund started with...
Use the information in the following table to answer the question. Note the fund started with 100 Net Asset Value at the start of 2012. 2012 2013 2014 2015 2016 2017 2018 2019 Return 8.0% 4.0% 1.7% -4.5% 9.7% 10.7% -0.3% -14.1% Asset Value 108.00 112.36 114.27 109.18 119.82 132.64 132.27 113.64 Given the above hedge fund manager’s performance, which year(s) would the manager get paid on their high water mark? (1.5 marks). Calculate the rolling 3 years average returns...
Answer the following short questions. Use MARR = 12% and tax rate = 40% in all...
Answer the following short questions. Use MARR = 12% and tax rate = 40% in all problems unless otherwise specified. 3. A young engineer calculated that monthly payments of $A are required to pay off a $5000 loan for n years at i% interest, compounded monthly. If the engineer decides to borrow $10,000 instead, her monthly payments are $2A. True or False
Question 1 (6pts). For the cash flows shown below, answer the following questions. (Assume MARR =...
Question 1 (6pts). For the cash flows shown below, answer the following questions. (Assume MARR = 12%) (1) (2pts) Provide the equation using PW to find the ROR of the cash flow given. (2) (2pts) Decide whether the project is acceptable or not using RATE function in MS Excel. Provide the screenshot (3) (2pts) Decide whether the project is acceptable or not using IRR function in MS Excel. Provide the screenshot Year Factor Amounts 0 Investment ($) 1,200,000 1-10 Revenue...
Compare the following three alternatives by the IRR method, given MARR of 8%/year. First find if...
Compare the following three alternatives by the IRR method, given MARR of 8%/year. First find if they are feasible and then compare them with the incremental rate of return method (DROR). Alt. Construction cost $       Benefits $/yr Salvage $ Service Life (yrs) A 510,000 145,000 10,000 5 B 775,000 155,000 15,000 9 C 1,075,000 165,000 20,000 11
Use the data given below to answer the following question(s). The following table exhibits the age...
Use the data given below to answer the following question(s). The following table exhibits the age of second-hand furniture and the corresponding prices. Use the table to answer the following question(s). (Hint: Use scatter diagram and XLMiner where necessary.) Number of Years Values 2 1856 14 348 7 1020 5 1530 10 349 8 780 9 653 3 1830 10 750 6 1300 Q1. What is the relationship between the age of the furniture and their values? _ _________________ Q2....
1a. Use the table below to answer the following questions. Suppose there are 15.66 million people...
1a. Use the table below to answer the following questions. Suppose there are 15.66 million people employed in the economy. Percent of Labor Force Cyclically Unemployed 2.62% Frictionally Unemployed 3.09% Structurally Unemployed 3.96% Instructions: Round your answers two decimal places. What is the unemployment rate?  % What is the natural rate of unemployment?  % 1b. Suppose you have been given the following information from a government and asked to compute the annual inflation rate. Instructions: Round your answers to two decimal places....
Use the following table to answer the question below. If you have the standard utility function...
Use the following table to answer the question below. If you have the standard utility function described in the lecture with A = 6, and you think the future will be like the 1926-1946 period, what fraction of your investments should be in the T-bill (i.e., the portfolio weight of T-bill)? Round your answer to 4 decimal places. For example, if your answer is 3.205%, then please write down 0.0321. time S&P500 ret. T-bill ret. Std. dev. 1926-2012 11.67% 3.58%...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT