LM Company is considering investing in a new project that will generate cash
inflows of $45,000 every year for the ten-year life of the project. Investing
in this new project will require the purchase of a new machine, which will cost
$200,000. The machine will have a salvage value of $15,000 at the end of ten
years, but will require a repair costing $6,000 at the end of year four and a 
repair costing $10,000 at the end of year seven. In addition, this project will
require an immediate investment of $40,000 in working capital which would be
released for investment elsewhere at the end of the ten years. LM Company has
a cost of capital of 8% and an income tax rate of 40%.

Calculate the net present value (NPV) of the new project.

LM Company is considering investing in a new project that will generate cash inflows of $45,000 every year for the ten-year life of the project. Investing in this new project will require the purchase of a new machine, which will cost $200,000. The machine will have a salvage value of $15,000 at the end of ten years, but will require a repair costing $6,000 at the end of year four and a repair costing $10,000 at the end of year seven. In addition, this project will require an immediate investment of $40,000 in working capital which would be released for investment elsewhere at the end of the ten years. LM Company has a cost of capital of 8% and an income tax rate of 40%. Calculate the net present value (NPV) of the new project.

You are working as head of the investment section at a very important firm in the financial sector. Unfortunately, the rest of the management team, and the board, missed the second module “Market failures and resource allocation” and you therefore need to clearly motivate your choices for the firm’s account. The options the board would like you to rank are the following: (1) Keep 10 000 SEK in the firms vault, or (2) Buy a risk free Government Bond with a return of 310 SEK per year forever, or (3) Buy shares of another firm (called X) on the stock market to be sold after one year. The selling price after one year is uncertain. The estimated probability is 50% for a future value of 15 000 SEK and 50% for a future value of 6630 SEK. (4) Buy shares of another firm (called Y) on the stock market to be sold after two years. The selling price after two years is uncertain. The estimated probability is 50% for a future value of 15 000 SEK and 50% for a future value of 6630 SEK. The relevant real interest is assumed to be 3% and the board of your firm is risk neutral. a) Rank the options and explain to the board (and me) how you think firm should act. b) Calculate the standard deviation (where it is relevant) and discuss in terms of uncertainty.

An expert reviews a sample of 10 scientific articles (n = 10) and records the following number of errors in each article: 4, 6, 3, 5, 2, 8, 4, 7, 1, and 4. Compute SS, variance, and standard deviation for this sample using the definitional and computational formula. (Round your answers to two decimal places.)

Based on the data shown below, calculate the regression line (each value to two decimal places)

y = _____ x + _______

Based on the data shown below, calculate the regression line (each value to two decimal places)

y = _____ x + _______

Based on the data shown below, calculate the regression line (each value to two decimal places)

y =_____ x + ____

Based on the data shown below, calculate the regression line (each value to two decimal places)

y =  x +

Yield to maturity. What is the yield of each of the following bonds if interest​ (coupon) is paid semiannual​ly? (Round to two decimal​ places.)

Here are quarterly data for the past two years, from these data, prepare a forecast for the upcoming year using decompostion. foreccast years 9 to 12. FORECAST ERROR?