Wendell’s Donut Shoppe is investigating the purchase of a new $34,600 donut-making machine. The new machine would permit the company to reduce the amount of part-time help needed, at a cost savings of $6,500 per year. In addition, the new machine would allow the company to produce one new style of donut, resulting in the sale of 2,500 dozen more donuts each year. The company realizes a contribution margin of $1.60 per dozen donuts sold. The new machine would have a six-year useful life.

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables.

Required:

1. What would be the total annual cash inflows associated with the new machine for capital budgeting purposes?

2. What discount factor should be used to compute the new machine’s internal rate of return? (Round your answers to 3 decimal places.)

3. What is the new machine’s internal rate of return? (Round your final answer to the nearest whole percentage.)

4. In addition to the data given previously, assume that the machine will have a $13,755 salvage value at the end of six years. Under these conditions, what is the internal rate of return? (Hint: You may find it helpful to use the net present value approach; find the discount rate that will cause the net present value to be closest to zero.)

What is the new growth theory? how does the new growth theory differ from the growth theory developed by Robert Solow?

Should Burberry’s be focused on new brick-and-mortar stores, as new CEO Christopher Bailey did with the opening of Burberry’s largest store, 121 Regent Street in London, or should they focus on more online sales worldwide? Are high-end products (clothing such as Burberry’s) better sold in stores or online, or both?

Imagine that you buy a new computer system with independent components including a new desktop computer (with a CPU and a graphics card), new software, and a new monitor. You want to play games on the new system, but it runs games very slowly. You assume that the keyboard and mouse are not creating the problem; so, to figure out what is making the system run so slowly, you experiment with combinations of your old equipment with the new equipment. Here are your experiments and results:

Experiment 1: New computer, new software, and new monitor — and it runs slowly.
Experiment 2: New computer, new software, and old monitor — and it runs slowly.
Experiment 3: New computer, old software, and new monitor — and it runs fast.
Experiment 4: New computer, old software, and old monitor — and it runs fast.
Experiment 5: Old computer, new software, and new monitor — and it runs fast.
Experiment 6: Old computer, new software, and old monitor — and it slowly.
Experiment 7: Old computer, old software, and new monitor — and it runs fast.
Experiment 8: Old computer, old software, and old monitor — and it runs fast.

Based on this data, which experiment shows that the conjunction of the new software and the old monitor is NOT SUFFICIENT for the system to run slowly?

• A. Experiment 1
• B. Experiment 2
• C. Experiment 3
• D. Experiment 4
• E. Experiment 5
• F. Experiment 6
• G. Experiment 7
• H. Experiment 8
• I. None of these experiments

Question:4

1. A new promotion by K2 has been developed with a goal of obtaining 90% new simcard connections among business firms. To evaluate the simcard sales, 20 are to be sold to business people in Kikuubo. If the 90% sales rate is correct, what is the probability that 18 or more of the sim cards will be sold to Kikuubo business men and women.

2. The life time of milk produced by Fresh Diary is normally distributed. The probability that a pack drawn from a Carton is defective is 0.1 and the success is 0.9, if a sample of 6 packs is taken, Find the probability that it will contain;

1. No defective packs   
2. 5 or 6 defective packs
3. Less than 3 defective packs

3. Using a relevant example, explain the Bernoulli trial              

Henderson is on a business trip in New Jersey. He drove his car from New York to New Jersey and checks into the Hotel Ritz. The Ritz has a guarded underground parking lot. Henderson gives his keys to the parking attendant, but did not tell him that his wife’s expensive ($15,000) fur coat was in the car. The coat was packed in a box in the trunk of the car. When Henderson went to check out the next day, he realized his car had been stolen. Henderson is very upset and wants to hold the hotel liable for the car and his wife’s $15,000 fur coat.

what will the insurance company do? Will they acknowledge the claim since the car was stolen at no fault to the owner? How will the owner prove that the coat was lost?

Are well-established firms or new entrants more likely to a) develop and/or b) adopt new technologies? What are some reasons for your choice?

PLEASE ANSWER IN WORD FORMAT ONLY. NO PICTURES. PLEASE ANSWER IN 350 WORDS.

Dont copy paste from website.

Thanks

Subject: Management of Technological Innovation

Profit or Loss on New Stock Issue

Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beedles Inc., the terms were as follows:

The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $500,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price?

1. $4.5 per share? Use minus sign to enter loss, if any.
   $
   
2. $6.25 per share? Use minus sign to enter loss, if any.
   $
   
3. $3.75 per share? Use minus sign to enter loss, if any.

A quaint but well-established coffee shop, the Hot New Cafe, wants to build a new cafe for increased capacity. Expected sales are $800,000 for the first 5 years. Direct costs including labor and materials will be 50% of sales. Indirect costs are estimated at $200,000 a year. The cost of the building for the new cafe will be a total of $850,000, which will be depreciated straight line over the next 5 years. The firm's marginal tax rate is 38%, and its cost of capital is 10%.. Prepare a capital budget for Hot New Café with net cash flows over a 5-year period. Show me how to do this? Im having the most trouble with determining NPV, PV and Payback Period. I also want to check my other calculations against yours.

NEW PROJECT ANALYSIS

You must evaluate a proposal to buy a new milling machine. The base price is $113,000, and shipping and installation costs would add another $20,000. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $45,200. The applicable depreciation rates are 33%, 45%, 15%, and 7%. The machine would require a $10,000 increase in net operating working capital (increased inventory less increased accounts payable). There would be no effect on revenues, but pretax labor costs would decline by $49,000 per year. The marginal tax rate is 35%, and the WACC is 11%. Also, the firm spent $5,000 last year investigating the feasibility of using the machine.

1. How should the $5,000 spent last year be handled?
   1. Last year's expenditure should be treated as a terminal cash flow and dealt with at the end of the project's life. Hence, it should not be included in the initial investment outlay.
   2. Last year's expenditure is considered as an opportunity cost and does not represent an incremental cash flow. Hence, it should not be included in the analysis.
   3. Last year's expenditure is considered as a sunk cost and does not represent an incremental cash flow. Hence, it should not be included in the analysis.
   4. The cost of research is an incremental cash flow and should be included in the analysis.
   5. Only the tax effect of the research expenses should be included in the analysis.
2. What is the initial investment outlay for the machine for capital budgeting purposes, that is, what is the Year 0 project cash flow? Round your answer to the nearest cent.
   $ ________

3. What are the project's annual cash flows during Years 1, 2, and 3? Round your answer to the nearest cent. Do not round your intermediate calculations.

   Year 1 $ ________

   Year 2 $ ________

   Year 3 $ ________

4. Should the machine be purchased?