1. Refer to excel data given below.

Modify model for projection of free cash flows from the Home Net project along the following dimensions:

1. Assume the equipment needed for the project is depreciated according to MACRS 5-year depreciation schedule:

5-year MACRS:

Year 0: 20%

Year 1: 32.0%

Year 2: 19.2%

Year 3: 11.52%

Year 4: 11.52%

Year 5:   5.76%

2. The equipment is sold at the end of year 4 for $0.5 m
3. One of every five customers expected to buy a Home Net device would have bought a Cisco router if Home Net devices were not available
4. In order to maintain constant number of units (100,000/year) sold over the duration of the project Cisco is planning to offer an introductory price of $250/unit in the first year, and going to reduce the price to $230/unit in the fourth year. In the second and the third year, as customers get to appreciate the new device, Cisco is hoping to be able to sell the gadgets for $260 per unit
5. Assume that the Net working capital is recovered as soon as the production is over (at the end of year 4)
6. Estimate NPV of the project assuming that r_wacc= 12%
7. Change your assumption about cost of capital and try several values above and below the initial value of 12%. Construct NPV-sensitivity-to-r_waccgraph (r_waccvalues must be on the X-axis, corresponding values of NPV on the Y-axis)

Data for the question:

During a 5-week period in 2007, the stock of an insurance company and the stock of a small tech company showed the following weekly percentage changes.

Find the variance of the weekly price changes of each. (Round your answers to four decimal places.)

Relate the two variances found to the riskiness of the two stocks.

The two stocks have the same riskiness.The insurance stock is riskier.    No statement about the riskiness of these stocks can be made.The tech stock is riskier.

You are the actuary in charge of purchasing a reinsurance contract for your insurance company. You have determined that the losses that you want reinsured follow a uniform distribution on the interval [1000, 2000]. You have a choice of two reinsurance contracts for these losses. The first contract will pay 90% of the loss, while the second contract will pay up to a maximum limit, where the limit is set so that the expected payment for both contracts are the same. Find the ratio of the variance of the reinsurance payment under the second policy to the variance of the reinsurance payment under the first policy.

A. 1.5

B. 1.2

C. 0.9

D. 0.6

E. 0.3

An expensive watch is powered by a​ 3-volt lithium battery expected to last three years. Suppose the life of the battery has a standard deviation of 0.3 year and is normally distributed.a. Determine the probability that the​ watch's battery will last longer than 3.8 years.b. Calculate the probability that the​ watch's battery will last more than 2.15 years.c. Compute the​ length-of-life value for which 15​% of the​ watch's batteries last longer.

a. The probability that the battery will last longer than 3.8 years is​

b. The probability that the battery will last more than 2.15 years is

c. The​ length-of-life value for which 15​% of the batteries last longer is years.

A peanut can has the usual “can shape” of a circular cylinder. Its sides are made of cardboard, its bottom is made of thick plastic-coated aluminum foil, and its top lid is made of clear plastic. It must have a volume of 480 cubic centimeters. The cardboard material used for the sides costs 0.1 cents per square centimeter, the foil material used for the bottom costs 0.3 cents per square centimeter, and the plastic material used for the top lid costs 0.5 cents per square centimeter. What dimensions should the can have in order to minimize the cost of the materials from which it is made?

Consider an annuity for 10 years, whose payments vary in geometric progression. An annual effective interest rate of 6% is used. Obtain the financial value at t = 29/05/2010 of this annuity considering different cases:

1. Annual payments increasing 3% annually. First payment (€1,650; 29/05/2011).
2. Annual payments increasing 5% annually. First payment (€1,650; 29/05/2011).
3. Monthly payments increasing 0.3% monthly. First payment (€175; 29/06/2010).
4. Monthly payments, constant during the year and increasing 4% annually. First payment (€175; 29/06/2010).

A peanut can has the usual “can shape” of a circular cylinder. Its sides are made of cardboard, its bottom is made of thick plastic-coated aluminum foil, and its top lid is made of clear plastic. It must have a volume of 480 cubic centimeters. The cardboard material used for the sides costs 0.1 cents per square centimeter, the foil material used for the bottom costs 0.3 cents per square centimeter, and the plastic material used for the top lid costs 0.5 cents per square centimeter. What dimensions should the can have in order to minimize the cost of the materials from which it is made?

A block of mass m begins at rest at the top of a ramp at elevation h with whatever PE is associated with that height. The block slides down the ramp over a distance d until it reaches the bottom of the ramp. How much of its original total energy (in J) survives as KE when it reaches the ground? (In other words, the acceleration is not zero like it was in lab and friction does not remove 100% of the original PE. How much of that original energy is left over after the friction does work to remove some?) m = 8.5 kg h = 5.5 m d = 5 m μ = 0.3 θ = 36.87°