A group of entrepreneurs want to purchase a rural hotel.

The renovation and purchase of the hotel has an estimated cost of €525,000.

This capital investment will be depreciated consistently over the next 5 years.

It is estimated that there will be 4,000 rooms total occupation per year, at a rate of €100 per room/night. Room occupation will rise by 5% year over year.

Running costs are estimated as €290,000 for the first year and will increase by 5% year over year.

The tax rate is 35%.

Step 1: Calculate the initial free cash flows correctly.

Step 2: If the partners require a minimum return of 8% on their investments, would you recommend that these businessmen buy the hotel? (Assume a continuous increase in cash flow of 1% from the 5^th year forwards). Why or why not?

a) A truck is bought for RO 30,000 and depreciation is charged at 10% p.a. by using written down value method, the amount of depreciation at the end of first year RO 3,000 and book value of the truck is RO 27,000. The amount of depreciation at the end of second year RO 2,700 and book value of the truck is RO 24.300 What does the amount book value of truck represent? Does this balance represent the original value of truck at the end of each year? Yes or no, comment on your answer. (Suggested: 80 – 100 words)
b) Truck is bought for RO 40,000 with an estimated useful life of 4 years. The expected scrap vahue at the end of its useful life is RO 2,000. Calculate the WDV Rate (Written Down Value method) and Prepare the Depreciation Schedule for 4 years.

Question1Task 5 v3

You are considering making a movie. The movie is expected to cost $100 million upfront and takes a year to make. After that, it is expected to make $82 million in the first year it is released and $7 million for the following 20 years. Your cost of capital is 10%.

a.) What is the payback period of this investment? (Hint: consider that you look upfront at this, that is from year=0. For solving this task it is necessary to consider carefully the timeline of the cash flows in years=0,1,2,3,....,21,22)

The payback period is years. (round to a full year)

b.) If you require a payback period of two years, will you make the movie?

Answer:  (fill in "yes" or "no")

c.) What is the NPV of this project?

The NPV is $ million. (round to two decimals)

d.) According to the NPV rule, should you make the movie?

Answer:  (fill in "yes" or "no")

You are considering making a movie. The movie is expected to cost $100 million upfront and takes a year to make. After that, it is expected to make $83 million in the first year it is released and $8 million for the following 20 years. Your cost of capital is 10%.

a.) What is the payback period of this investment? (Hint: consider that you look upfront at this, that is from year=0. For solving this task it is necessary to consider carefully the timeline of the cash flows in years=0,1,2,3,....,21,22)

The payback period is years. (round to a full year)

b.) If you require a payback period of two years, will you make the movie?

Answer:  (fill in "yes" or "no")

c.) What is the NPV of this project?

The NPV is $ million. (round to two decimals)

d.) According to the NPV rule, should you make the movie?

Answer:  (fill in "yes" or "no")

You are considering making a movie. The movie is expected to cost $100 million upfront and takes a year to make. After that, it is expected to make $81 million in the first year it is released and $6 million for the following 20 years. Your cost of capital is 10%.

a.) What is the payback period of this investment? (Hint: consider that you look upfront at this, that is from year=0. For solving this task it is necessary to consider carefully the timeline of the cash flows in years=0,1,2,3,....,21,22)

The payback period is years. (round to a full year)

b.) If you require a payback period of two years, will you make the movie?

Answer:  (fill in "yes" or "no")

c.) What is the NPV of this project?

The NPV is $ million. (round to two decimals)

d.) According to the NPV rule, should you make the movie?

Answer:  (fill in "yes" or "no")

1. Provide an example of any two leading companies from the same industry which are competing directly for marketshare. Give a short profile (300-500 words) for each (provide references for your answers). 2. If you are the manager of one of these companies, what pricing policy do you adopt to be in the first position? Why? (100-200 words) 3. When the whole sector of the market is occupied by the little number of big corporations who share the leadership, what do we call this type of market structure? Explain in details the benefit of this market for the leading company and the disadvange of such situation on final consumers (300-500 words)

Note: Use Starbucks and Costa Coffee for this subject. ( please do not answer with handwriting ) ( Do not copy the answer from other resources)

1. A pipeline is to be inspected. There is a 10% chance that any 100ft section of pipeline will contain at least one defect (thinning walls, weld defect, etc). Assume the sections are independent (whether one sections fails or not is independent of whether other sections fail or not).
   1. What is the probability that, given 2 defective sections have been found so far, that exactly 12 sections of pipeline have been inspected?
   2. What is the probability that, given 50 sections have been inspected so far, that fewer than 5 defective sections have been found?
   3. What is the probability that the first defect will be found in the 10^th pipeline inspected?
   4. What is the average (expected) number of defects per 100 pipelines sections inspected?
   5. Comment on the independence assumption. Do you believe this is a realistic assumption for a pipeline? Why or why not?

Write a MATLAB script file to numerically solve any first order initial value problem using Rulers method. Once code is working use it to solve the mixing tank problem below. Use a step size of 1 minute, and simulate the solution until the tank contains no more salt. Plot both the Euler approximation and the exact solution on the same set of axes.

A tank contains 100 gallons of fresh water. At t=0 minutes, a solution containing 1 lb/gal of brine is pumped into the tank at a rate of 1 gal/min. while the mixture is pumped out at a rate of 2 gal/min. Model the corresponding initial value problem, and then determine the amount of salt in the tank as a function of time until the tank is empty.

Company «Rho», during the last fiscal year, had book value per share €100, earnings per share €10 and distributed €2 dividends per share. For the next 3 years the firm is expected to have a stable payout ratio and stable return on equity. From the 3rd year and onwards the firm is expected to distribute 50% of its earnings and to have a return on equity of 5%. The beta coefficient of the firm is 1.5, the return of the market 9% and the risk free rate 6%, answer questions

a)What is the cost of equity?What is the retention ratio in the high growth period?

b)What is the return on equity in the high growth period?What is the growth rate in the stable growth period?

c)What are the dividends in the first 3 years?

A professor notices that more and more students are using their notebook computers in class, presumably to take notes. He wonders if this may actually improve academic success. To test this, the professor records the number of times each student uses his or her computer during a class for one semester and the final grade in the class (out of 100 points). If notebook computer use during class is related to improved academic success, then a positive correlation should be evident. Given the following data, test whether notebook computer use and grades are related at a .05 level of significance.

State the conclusions for this test using APA format. First, describe the correlation coefficient in words and give the value of r. Then give the value of R2 and describe (in words) the effect size using the coefficient of determination. Finally, is there a significant relationship?