consider a simple economy that produces only two products: A, B.   

Compute nominal GDP, real GDP, and the GDP deflator for each year, using 2018 as the base year.

You've estimated the following cash flows (in $ million) for two mutually exclusive projects:

The appropriate discount rate is 9%.

Part 1

What is the NPV of project A (in $ million)?

Part 2

What is the NPV of project B (in $ million)?

Here is a table showing all

52

cards in a standard deck.

A card is drawn at random from a standard deck. That card is not put back in the deck, and a second card is drawn at random from the remaining cards in the deck.

What is the probability that both of the cards are hearts?
Do not round your intermediate computations. Round your final answer to four decimal places.

Island Airlines Inc. needs to replace a short-haul commuter plane on one of its busier routes. Two aircraft are on the market that satisfy the general requirements of the route. One is more expensive than the other but has better fuel efficiency and load-bearing characteristics, which result in better long-term profitability. The useful life of both planes is expected to be about seven years, after which time both are assumed to have no value. Cash flow projections for the two aircraft follow.

1. Calculate the payback period for each plane and select the best choice. Round your answers to one decimal place.

   Low Cost	years
   High Cost	years

   
   
2. Calculate the IRR for each plane and select the best option. Use the fact that all the inflows can be represented by an annuity. Round your answers to one decimal place.

   Low Cost	%
   High Cost	%

   
   IRR also selects the   cost plane.
   
3. Compare the results of parts (a) and (b). Both should select the same option, but does one method result in a clearer choice than the other based on the relative sizes of the two payback periods versus the relative sizes of the two IRRs?
   The input in the box below will not be graded, but may be reviewed and considered by your instructor.
   
   
4. Calculate the NPV and PI of each project assuming a cost of capital of 9%. Use annuity methods. Do not round intermediate calculations. Round PVFA values in intermediate calculations to four decimal places. Round NPV to the nearest dollar, round PI to two decimal places.

   	Low Cost	High Cost
   NPV	$	$
   PI

   
   Which plane is selected by NPV?
   high or low cost plane?
   By PI?
   high or low cost plane?
   
5. Calculate the NPV and PI of each project, assuming the following costs of capital: 2%, 4%, 6%, 8%, and 10%. Use annuity methods. Do not round intermediate calculations. Round PVFA values in intermediate calculations to four decimal places. Round NPV to the nearest dollar, round PI to two decimal places. Use a minus sign to indicate a negative NPV.

   		Low Cost	High Cost
   2%	NPV	$	$
   	PI
   4%	NPV	$	$
   	PI
   6%	NPV	$	$
   	PI
   8%	NPV	$	$
   	PI
   10%	NPV	$	$
   	PI

   
   Is the same plane selected by NPV and PI at every level of cost of capital? Investigate the relative attractiveness of the two planes under each method.
   
   
6. Use the results of parts (b) and (e) to sketch the NPV profiles of the two proposed planes on the same set of axes. Show the IRRs on the graph.

   Select the correct graph.

   a,b,c or d

   The correct graph is  .

   Would NPV and IRR ever give conflicting results? Why?
   The input in the box below will not be graded, but may be reviewed and considered by your instructor.

A 2000-gram male infant was delivered at 34 weeks’ gestational age by cesarean section due to breech presentation, premature labor, and rupture of membranes. On physical examination the infant was non-dysmorphic, appeared vigorous, had spontaneous respirations, and the skin was pink and well perfused. Apgar scores were 7 and 9 at 1 and 5 minutes, respectively. One hour after admission to the neo- natal intensive care unit, the infant developed tachypnea and nasal flaring with moderate subcostal and substernal retractions. Bronchial breath sounds that were slightly diminished in intensity were present. Analysis of umbilical arterial blood revealed a pH of 7.37, a PaO2 of 50 mm Hg, and a PaCO2 of 30 mm Hg. To improve work of breathing, continuous positive airway pressure (CPAP) of + 6 cm H2O was initiated via nasal prongs. One hour later the infant’s vital signs were as follows: temperature 37.6°C under radiant heat, blood pressure 60/42 mm Hg, heart rate 130 beats per minute, oxygen saturation 94% to 96% while breathing 40% oxygen with CPAP, and blood glucose 70 mg/dL. The remainder of the examination was normal for the gestational age. The infant’s respiratory status gradually improved, and over the next 3 days he was weaned from CPAP and transitioned to a nasal cannula and then to room air. Two days later, the infant was discharged home. 1. What are important components of the initial neonatal assessment? 2. What was concerning about this patient’s respiratory status, and what should the healthcare team continue to monitor? 3. What intervention would you consider if the CPAP + 6 did not improve the infant’s work of breathing?

1. What intervention would you consider if the CPAP + 6 did not improve the infant’s work of breathing?

1. Kiwi traders have invested in two securities traded at the Nairobi Stock Exchange (NSE). Supposing A and B’s possible returns are as follows:

X=18%, 16%, 14%, 12%, 10%, 8%, 7%, 5%, 3% and 0% for periods one to ten.

Y=6%,7%,8%,9%,11%,13%,15%,17, %19%,19.5%, for periods one to ten, and each possible return has an equal chance in both cases. Other details remain the same.

Required

If Kiwi trader’s portfolio formation is Ksh 300,000, committing equal amounts in each asset, determine the Portfolio risk? (show working)

At the beginning of June, Rhone Company had two jobs in process, Job 44 and Job 45, with the following accumulated cost information:

During June, two more jobs (46 and 47) were started. The following direct materials and direct labor costs were added to the four jobs during the month of June:

At the end of June, Jobs 44, 45, and 47 were completed. Only Job 45 was sold. On June 1, the balance in Finished Goods was zero.

Calculate the ending balances of Work in Process and Finished Goods as of June 30.

4. Calculate the Cost of Goods Sold for June.

Cost of Goods Sold:

You decide that you want to save 767,393 dollars for retirement. Assuming that you are 25 years old today, will retire at the age of 65, and can earn a 8 percent annual interest rate on your deposits, how much must you deposit each year to meet your retirement goal? (your first deposit will be one year from now and your last deposit will be 40 years from today, i.e. 40 deposits) Hint : The number of years for FVIFA computation will be 40 years