Henry Jones is the owner of True Adventure Vacations, Inc. He is considering the purchase of computer equipment that will facilitate airline and hotel accommodations. He paid a consultant a $20,000 fee to identify the best computer system and to identify the best computer system and to identify related costs of the project. The computer will cost $300,000. Installation will cost $20,000 and training of personnel will cost $10,000. He will incur $50,000 in advertising costs to kick off the new improved services that will feature worldwide accommodations. He projects that there will be a $200,000 increase in sales annually over the 5 year life of the project. Costs are 60% of sales. The computer has a five year useful life and a salvage value of $30,000. Jones will use straight line depreciation. Working capital investment is $10,000 and will be fully recovered at the termination of the project in five years.

1. What is the annual after-tax cash flow for this project over the next five years? The tax rate is 34%.
2. What is the NPV of the project if the discount rate is 12%?

At a facility’s loading dock, delivery vehicles arrive randomly, starting at 8:00 AM, at a rate of 2.0 per hour. If the dock is occupied by another vehicle, the driver must park in a waiting area until the dock is clear; this occurs with probability 0.20, independent of the time of day or other variables. Identify the family and parameter(s) of each of the following random variables (for instance, “Bernoulli(0.5)”). If it is not one of our “famous” families indicate “other”; if the parameters cannot be determined indicate so.

(a) The time elapsed before the next vehicle arrives.

(b) The number of arrivals between 8:00 AM and 10:00 AM.

(c) The number of vehicles in the loading dock.

(d) Of the next 10 deliveries to arrive, the number than have to wait for the dock to clear.

(e) The number of vehicles in the waiting area.

(f) The number of deliveries made up to and including the first that has to wait for the dock to clear.

(g) The arrival time of the third delivery on a given day

For each of the following scenarios, develop a testable hypothesis.
a. Scenario 1. Kelly and Jack are playing in the park. Jack rolls a marble
down the small playground slide. Kelly proposes the idea that the marble
would travel at a faster pace if it is rolled down the longer slide.
b. Scenario 2. Andy’s nightly chores include washing the family dishes. His
mother tends to cook everything that she prepares a bit too long. Because
of this, Andy spends a lot of swear, effort, and time washing the dishes.
He sees a commercial on televisions that claims that brand X dishwashing
detergent cuts through grease better than its competitor brand Y.
c. Scenario 3. Ali’s favorite food is microwave popcorn. She lives microwave
popcorn so much that she can’t stand to waste the un-popped kernels in
the bottom of the bag. The next time Ali goes to the grocery store she
buys all the brands of microwave popcorn that the store has.

Monopoly behavior (Chapter 26 in the book)

Problem 1. Suppose you want to open an amusement park. Your estimate of the daily attendance is 1000 people. Further, you expect that each person will demand

x(p)= 50-50p rides, where p is the price per ride. All people are the same, and there cannot be negative rides. The marginal cost of a ride is zero.

(a) What is each person’s inverse demand for rides?

(b) How many rides per person will maximize your profits?

(c) What will be the profit-maximizing price per ride?

(d) What will be your profit per person?

(e) What is the Pareto efficient price per ride?

(f) How many rides will be purchased at the Pareto efficient price by a single person?

(g) Ho much consumer surplus per person will be generate at Pareto efficient price and quantity?

(h) If you decide to use a two-part tariff, what would be an admission fee and a price per ride for a single person?

Suppose a carnival director in a certain city imposes a patron height limit on an amusement park ride called Terror Mountain, due to safety concerns. Patrons must be at least 4 feet tall to ride Terror Mountain. Suppose patrons’ heights in this city follow a Normal distribution with a mean of 4.4 feet and a standard deviation of 0.8 feet (patrons are mostly children). Note: make sure to show all of your work in this question. Show the distribution that your random variable follows; state the probability you are asked to calculate; show any tricks you use; show how you standardize, show your rounded z-score (round to 2 decimal places), and state your found value from Table A4.

a) What is the probability that a randomly selected patron would be tall enough to ride Terror Mountain? [5 marks]

b) A group of 3 friends want to ride Terror Mountain. What is the probability that their mean height is greater than 4.5 feet? [5 marks]

A forest product company likes to develop a wood pellet manufacturing plant in Maryland and has the following cost information on five likely destinations (table below). The expected sale price of wood pellets per bag is $5. a. Please find out which location is preferable in terms of BEP_x and/or BEP_$? b. What should be the minimum out level the company should target to earn some profit? c. Using the locational break-even analysis (cross-over quantity with minimum cost), can you identify any other location that may be more profitable? d. What should be the minimum quantity of output at the new location for maximizing profit?

Let's think about drug addiction and how American society treats individuals that have addiction problems. When someone is labeled a drug addict, they're identified by their problem and not as an individual. I thought this video provides an interesting alternative to our current policies.  

Drug related arrests are also disproportionate if we examine factors such as race and income level. The speaker discusses the "war on drugs" and how it has not been very effective in combating drug addiction and drug use.  

1. Do you think the war on drugs has been effective?

2. The speaker discusses two experiments on mice, one on solitude and one in "rat park". How are the results different in each experiment? How can we apply these two circumstances to human life?

3. What do you think are better solutions to reducing the rates of drug addiction.  

4. What programs can help individuals recovering from drug addiction reconnect with society?

Project 2: Capital Budgeting Activity
Scenario:
Your client owns a successful restaurant in downtown Chicago (at least pre-Covid-19!). She wants to open a second restaurant in the suburbs and has asked you to help her choose between two locations. Key information is listed below. Using the four capital budgeting methods that we know, prepare a presentation that shows your recommendation to your client (and why).

Initial Investment: 2,500,000 and use 9% discount rate

Annual non-cash (all depreciation) expenses:
Use straight line depreciation to find!
For both, assume no residual value and: 9% discount rate

REQUIREMENTS:

Calculate the following and note each formula

1. Payback Period
2. NPV
3. Internal Rate of Return Method
4. Profitability Index

In the 2009 film 2012, there is a scene in which a supervolcano erupts under Yellowstone National Park. It has been fairly recently discovered that in at least some volcanic eruptions, the magnetic field of the earth is reversed in the region of the volcano (only while it is erupting). The magnetic field during this eruption would have a magnitude of 5.3 ⋅ 10−4 ? and be oriented 68.6∘ south of down. During the eruption, there is a pyroclastic flow (this is the fast lava-looking “liquid” that flows down the volcano first), which can move at speeds upwards of 200 ?⁄?. One particular rock flowing in this has a mass of 150 ????? and an electric charge of +1.2 ⋅ 104 ?.

1. Find the Lorentz (magnetic) force (magnitude and direction) acting on this rock when it has just started flowing near the top of the volcano. At this point, it flows at a speed of 50 ?⁄? vertically downward.

2. Find the Lorentz (magnetic) force (magnitude and direction) acting on this rock when it has just reached the bottom of the volcano. At this point, it flows at a speed of 200 ?⁄? horizontally east.

1.At takeoff a commercial jet has a 65.0 m/s speed. Its tires have a diameter of 0.700 m.

(a) At how many rpm are the tires rotating?
___ rpm
(b) What is the centripetal acceleration at the edge of the tire?
____ m/s²
(c) With what force must a determined 10^-15 kg bacterium cling to the rim?
____N
(d) Take the ratio of this force to the bacterium's weight.
____(force from part (c) / bacterium's weight)

2.(a) A 19.0 kg child is riding a playground merry-go-round that is rotating at 35.0 rpm. What centripetal force must she exert to stay on if she is 1.00 m from its center?
____ N
(b) What centripetal force does she need to stay on an amusement park merry-go-round that rotates at 3.00 rpm if she is 6.00 m from its center?
____ N
(c) Compare each force with her weight.
____ (force from part (a) / weight)
____ (force from part (b) / weight