Questions
Integrative—Complete investment decision    Wells Printing is considering the purchase of a new printing press. The total...

Integrative—Complete investment decision   

Wells Printing is considering the purchase of a new printing press. The total installed cost of the press is $2.11 million. This outlay would be partially offset by the sale of an existing press. The old press has zero book​ value, cost $1.02 million 10 years​ ago, and can be sold currently for $1.28 million before taxes. As a result of acquisition of the new​ press, sales in each of the next 5 years are expected to be $1.57 million higher than with the existing​ press, but product costs​ (excluding depreciation) will represent 46% of sales. The new press will not affect the​ firm's net working capital requirements. The new press will be depreciated under MACR

Rounded Depreciation Percentages by Recovery Year Using MACRS for

First Four Property Classes

Percentage by recovery​ year*

Recovery year

3 years

5 years

7 years

10 years

1

33​%

20​%

14​%

10​%

2

45​%

32​%

25​%

18​%

3

15​%

19​%

18​%

14​%

4

7​%

12​%

12​%

12​%

5

12​%

9​%

9​%

6

5​%

9​%

8​%

7

9​%

7​%

8

4​%

6​%

9

6​%

10

6​%

11

4​%

Totals

100​%

100​%

100​%

100​%

​*These percentages have been rounded to the nearest whole percent to simplify calculations while retaining realism. To calculate the actual depreciation for tax​ purposes, be sure to apply the actual unrounded percentages or directly apply​ double-declining balance​ (200%) depreciation using the​ half-year convention.

using a​ 5-year recovery period. The firm is subject to a 40% tax rate. Wells​ Printing's cost of capital is 11.1%.​(Note: Assume that the old and the new presses will each have a terminal value of $0 at the end of year​ 6.)

a. Determine the initial investment required by the new press.

b. Determine the operating cash flows attributable to the new press.​ (Note: Be sure to consider the depreciation in year​ 6.)

c. Determine the payback period.

d. Determine the net present value​ (NPV) and the internal rate of return​ (IRR) related to the proposed new press.

e. Make a recommendation to accept or reject the new​ press, and justify your answer.

In: Finance

Food companies have often been accused of targeting children with adverts for unhealthy products such as...

Food companies have often been accused of targeting children with adverts for unhealthy products such as fast food, confectionery and snacks. Assess the extent of advertising of ‘unhealthy food’ to children based on this evidence is it more or less than other products? Are children targeted more than adults?

In: Economics

Your Professional Experience assignment is to develop a promotional message. This can be an email, letter,...

Your Professional Experience assignment is to develop a promotional message. This can be an email, letter, info graphic, image, or any other relevant material that answers why should students take a Professional Communications course.

In: Accounting

a. XYZ Inc. is accused of being a monopoly. The CEO claims that it’s not a...

a. XYZ Inc. is accused of being a monopoly. The CEO claims that it’s not a monopoly, arguing that if XYZ were to raise its price it would lose sales. This is because consumers always have the option to spend their money on other goods. Is the CEO’s argument persuasive? Explain (6 pts.)

b. (Unrelated to the above) A monopoly firm is currently maximizing profit, earning economic profit of $10 million per year. It is now successfully sued by a former employee who is awarded $1 million. A manager of the firm argues that to recoup the lost $1 million, the firm needs to raise its price. Do you agree? Explain. (6 pts).

In: Economics

Access the article entitled “Biofeedback: Listen to the body” written by Alexander and Steefel (1995). After...

Access the article entitled “Biofeedback: Listen to the body” written by Alexander and Steefel (1995). After reading this informative article, answer any two of the following questions: Alexander & Steefel, 1995.pdf

  • What are the seven uses of biofeedback training discussed in the article?
  • What is an EMG, and what is it used for?
  • What is the key to success in biofeedback training?
  • Is it possible to control the blood flow in one’s finger?

Be sure to support your assertions and demonstrate the psychological relevance of your answers.

In: Psychology

Q- With regard to the CRISPR application of biotechnology, Should access to novel and expensive technology...

Q- With regard to the CRISPR application of biotechnology, Should access to novel and expensive technology be provided to those who cannot afford it? (100 Words)

In: Biology

When analyzing a novel, it's critical to use _______ to support your interpretation. A. denotation B....

When analyzing a novel, it's critical to use _______ to support your interpretation. A. denotation B. figurative language C. evidence D. opinion

In: Psychology

Please outline a brief research proposal to study the structure and function of a novel protein...

Please outline a brief research proposal to study the structure and function of a novel protein with known sequence but has never been investigated before.

In: Biology

Provide an explanation in support of or refuting the following statement: Humans would never develop natural...

Provide an explanation in support of or refuting the following statement: Humans would never develop natural immunity to a novel biological agent created in a laboratory

In: Biology

1. Problems and Applications Q1 A publisher faces the following demand schedule for the next novel...

1. Problems and Applications Q1

A publisher faces the following demand schedule for the next novel from one of its popular authors:

Price

Quantity Demanded

(Dollars)

(Copies)

40 0
36 50,000
32 100,000
28 150,000
24 200,000
20 250,000
16 300,000
12 350,000
8 400,000
4 450,000
0 500,000

The author is paid $800,000 to write the novel, and the marginal cost of publishing the novel is a constant $4 per copy.

Complete the second, fourth, and fifth columns of the following table by computing total revenue, total cost, and profit at each quantity.

Quantity

Total Revenue

Marginal Revenue

Total Cost

Profit

(Copies)

(Dollars)

(Dollars)

(Dollars)

(Dollars)

0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000

Which of the following quantity–price combinations would a profit-maximizing publisher choose? (Note: If the publisher is indifferent between more than one choice, select all of the indifferent combinations.) Check all that apply.

150,000 copies at a price of $28

200,000 copies at a price of $24

250,000 copies at a price of $20

300,000 copies at a price of $16

Complete the third column of the previous table by computing marginal revenue. (Hint: Recall that MR=ΔTRΔQMR=ΔTRΔQ.)

True or False: At each quantity, marginal revenue is less than the price.

True

False

Use the black points (plus symbol) to graph the marginal revenue from the 50,000th, 100,000th, 150,000th, 200,000th, 250,000th, and 300,000th copy of the novel. Remember to plot from left to right and to plot between integers. For example, if the marginal revenue of increasing production from 50,000 copies to 100,000 copies were 10, then you would plot a point at (75, 10). Next use the orange line (square symbol) to graph the marginal-cost curve faced by the publisher. Finally, use the blue points (circle symbol) to graph demand at the following quantities (in thousands): 0, 50, 100, 150, 200, 250, 300, 350, 400, 450, and 500.

Marginal RevenueMarginal CostDemandDeadweight Loss0501001502002503003504004505004036322824201612840-4PriceQuantity (Thousands of copies)200, 24Y-Intercept: 4Slope: 0

The marginal-revenue and marginal-cost curves intersect at a quantity of   copies.

On the previous graph, use the black triangle (plus symbols) to shade the area representing deadweight loss.

If the author were paid $1 million instead of $800,000 to write the book, the publisher would   the price it charges for a copy of the novel.

Suppose the publisher was not profit-maximizing but was concerned with maximizing economic efficiency, and the author of a novel was paid $800,000 to write the book.

In this case, the publisher would charge

for a copy of the novel and earn a profit of

. (Note: If the publisher experiences a loss, be sure to enter a negative number for profit.)

In: Economics