"A firm is considering purchasing a computer system. The following data has been collected.
- Cost of the system: $180,000
- Project life: 6 years
- Salvage value at the end of year 6: $14,000
- Depreciation method: five-year MACRS
- Tax rate: 21%
- Annual revenue from project: $148,000
- Annual expenses (not including depreciation): $93,000
The firm will borrow the entire $180,000 at 6.4% interest to be repaid in 2 annual payments.
The firm's MARR is 15%. Determine the IRR for the computer system. Enter your answer as a percentage rounded to the nearest tenth of a percent."

Suppose BO company uses the indirect method to prepare the cash flow statement. Indicate which of the following items will appear in the cash flow from operating activities section of the cash flow statement. [Tick all that apply].

Annual revenues are used to predict the value of a baseball franchise. A sample of 32 franchises was used. An analysis of variance of these data showed that b1= 5.0785 and Sb1 = 0.2357.

a. At the 0.05 level of​ significance, is there evidence of a linear relationship between annual revenue and franchise​ value?

b. Construct a​ 95% confidence interval estimate of the population​ slope, β1.

a: Compute the test statistic. tSTAT= ​(Round to four decimal places as​ needed.)

The critical​ value(s) is(are) ​(Round to four decimal places as​ needed.)

b: The​ 95% confidence interval is ____ ≤ β1 ≤ ____ ​(Round to four decimal places as​ needed.)

3. A single-price monopolist has the schedules given in the table below.

a. Determine the profit-maximizing level of output, price as well as the amount of profit or loss at this level. Clarify how you obtain the answer.

…………………………………………………………………………………………………..

…………………………………………………………………………………………………..

…………………………………………………………………………………………………..

b. Compare between the perfect competition and monopoly market structure.

…………………………………………………………………………………………………..

…………………………………………………………………………………………………..

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[Total: 10 marks]

Suppose that the world price for a good is 120 and the domestic demand-and-supply curves are given by the following equations:

                                                          Demand: P = 200 – 8Q

Supply: P = 20 + 10Q

      a. How much is domestic consumption?

      b. How much is domestic production?

      c. Calculate the values of consumer and producer surplus.

      d. If a tariff of 30% is imposed, how much do consumption and domestic production change?

      e. What is the change in consumer and producer surplus?

      f. How much revenue does the government earn from the tariff?

      g. What is the net national cost of the tariff?

Market demand and supply for a commodity are given by the following equations:

Demand: X = 30 – (1/3) P

Supply: X = -2.5 + (1/2) P where X= quantity (units), and P=price per unit ($)

Suppose that the government is planning to impose a tax on this commodity and considering the following two options:

Option 1: A unit tax of $15 Option 2: An ad valorem tax of 20%

a) Find the tax incidence on buyers and producers, and the tax revenue of the government under each the two options

b) Compare the two options in terms of their welfare costs

The City Sky Co is a property investment and development company. Recently the company purchased a vacant piece of land south of Brisbane on which it is planning to build 15 apartments to sell. The City Sky Co has engaged the services of the local lawyer, Maurice Blackburn, to provide the legal services required for the development for $33,000. Maurice Blackburn runs an established sole trader business and turns over revenue of $300,000 per year. Advise The City Sky Co of the input tax credit entitlements that they may be entitled to. Assume that The City Sky Co is registered for GST purposes.

Consider a country’s domestic market with demand and supply functions: Supply function: ? = 40? − 40 Demand function: ? = 200 − 20?

As the country joins the international trade, the world price for the good is given as $2. a. Is this country exporting or importing? If so, what is the size of export or import?

Now, the government decides to impose $1 tariff to protect its industry. b. Find the size of tariff revenue. Draw a graph before/after the tariff, and clearly mark regions for deadweight loss.

c. Who (among sellers and buyers) benefits from the tariff? Why?

The demand curve for X goods is Xd=100-10P and the supply curve is MCx=1. The demand curve for Y goods is Yd=100-20P and the supply curve is MCy=1. A tax of $2 per unit on goods X and no tax on goods Y.
a. Calculate tax revenues and excesses in X goods.
b. Explain the total tax revenue and excess burden if you reduce the tax on goods X to one dollar and impose one dollar per unit on goods Y.
c. Explain which tax system is more desirable.