X Company is considering a new processor that costs $150,000. Shipping and setup costs for the new processor are estimated to be $15,000. X’s working capital requirement is expected to increase by $17,000 when the new processor begins operation and is expected to be fully recoverable at the end of the project. The new processor’s useful life is expected to be 5 years and its salvage value at that point is estimated to be $60,000. The new processor is being depreciated using a 5-year ACRS life. Assume a tax rate of 35% and a cost of capital of 12%.

Estimated incremental revenues and incremental cash operating expenses for the new processor before tax for each year are shown in the table below.

Q1.) What is the book value of the new processor at the end of Year 3?

Q2.) What is the total after-tax cash flows in Year 5? Total means incremental cash flows plus terminal cash flows.

Photochronograph Corporation (PC) manufactures time series photographic equipment. It is currently at its target debt-equity ratio of .67. It’s considering building a new $65.7 million manufacturing facility. This new plant is expected to generate aftertax cash flows of $7.45 million in perpetuity. There are three financing options: a. A new issue of common stock: The required return on the company’s new equity is 15.3 percent. b. A new issue of 20-year bonds: If the company issues these new bonds at an annual coupon rate of 7.2 percent, they will sell at par. c. Increased use of accounts payable financing: Because this financing is part of the company’s ongoing daily business, the company assigns it a cost that is the same as the overall firm WACC. Management has a target ratio of accounts payable to long-term debt of .09. (Assume there is no difference between the pretax and aftertax accounts payable cost.)

If the tax rate is 22 percent, what is the NPV of the new plant? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234,567.89.)

Photochronograph Corporation (PC) manufactures time series photographic equipment. It is currently at its target debt–equity ratio of .56. It’s considering building a new $71.3 million manufacturing facility. This new plant is expected to generate aftertax cash flows of $7.88 million in perpetuity. There are three financing options: A new issue of common stock: The required return on the company’s new equity is 15.1 percent. A new issue of 20-year bonds: If the company issues these new bonds at an annual coupon rate of 7.3 percent, they will sell at par. Increased use of accounts payable financing: Because this financing is part of the company’s ongoing daily business, the company assigns it a cost that is the same as the overall firm WACC. Management has a target ratio of accounts payable to long-term debt of .14. (Assume there is no difference between the pretax and aftertax accounts payable cost.) If the tax rate is 38 percent, what is the NPV of the new plant? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Round your answer to 2 decimal places, e.g., 32.16.)

Woo Audio is a small company in New York that makes high-quality headphone amplifiers. The company makes each amplifier by hand using premium audio components and vacuum tubes. Recently, the owner of the company noticed a trend in the headphone community toward using portable, high-quality headphone amplifiers. These new units combine a digital-to-analog converter with a high-power amplifier in a package small enough to put in a pocket.

Review the three-phase, eight-stage, new product development process:

• Phase I: Generating and Screening Ideas
  Stage 1: Generating New Product Ideas
  Stage 2: Screening Product Ideas
  Stage 3: Concept Development and Testing
• Phase II: Developing New Products
  Stage 4: Business Case Analysis
  Stage 5: Technical and Marketing Development
• Phase III: Commercializing New Product
  Stage 6: Test Marketing and Validation
  Stage 7: Launch
  Stage 8: Evaluation

Select one of the phases and explain how Woo Audio would proceed through that phase to develop a conceptual new product that will generate excitement in the headphone community.

Question 1

1. Data collected (including the normalized values) by a riding mower manufacturer on its existing customers are listed below.

   Customer ID	Income	Lot_Size	Normalized Income	Normalized Lot_Size	Ownership
   1	61.5	20.8	-0.351	0.762	Owner
   2	82.8	22.4	0.726	1.421	Owner
   3	52.8	20.8	-0.790	0.762	Nonowner
   4	84	17.6	0.786	-0.556	Nonowner
   5	63	14.8	-0.275	-1.709	Nonowner

   The riding mower manufacturer wants to classify a new customer (data given below) as either an owner or a nonowner using k-Nearest Neighbors method.

   Income	Lot_Size	Normalized Income	Normalized Lot_Size
   81	20	0.635	0.532

   Round your answers to 3 digits after the decimal point.

   The Euclidean distance between the new customer and Customer 1 is?

   The Euclidean distance between the new customer and Customer 2 is?

   The Euclidean distance between the new customer and Customer 3 is?

   The Euclidean distance between the new customer and Customer 4 is?

   The Euclidean distance between the new customer and Customer 5 is?

   The new customer should be classified as?(owner or nonowner?) if k is set to 3.

QUESTION 28

1. Current evidence indicates the first humans infected with HIV lived in

   		a. Haiti
   		b. Indonesia
   		c. Africa
   		d. San Francisco

2 points   

QUESTION 29

1. If nondisjunction occurs in one chromosome pair in meiosis I during gametogenesis, what will be the result at the completion of meiosis?

   		a. All the gametes will be diploid.
   		b. Half of the gametes will have an extra chromosome, and half will be missing one.
   		c. There will be three extra gametes
   		d. Two of the four gametes will be haploid, and two will be diploid.

2 points   

QUESTION 30

1. What is the reason that alleles of linked genes are usually inherited together?

   		a. They are located close together on the same chromosome.
   		b. The number of genes in a cell is greater than the number of chromosomes.
   		c. Chromosomes are unbreakable.
   		d. Alleles are paired together during meiosis.

2 points   

QUESTION 31

1. This is the pedigree of a family with dry earwax syndrome, a single gene trait. Individuals with dry earwax often need professional flushing of the ear canals to avoid blockage. Individuals with dry earwax also have less body odor, and are less likely to get breast cancer. Affected individuals are colored circles and squares. Open circles and squares indicate those with normal wet earwax. Based on the pedigree, does this dry earwax appear to be dominant or recessive?

   		a. Dominant: Almost half the family has it
   		b. Recessive: Mostly boys are affected
   		c. Dominant: Every affected parent has an affected child
   		d. Recessive: Unaffected parents can have an affected child

2 points   

QUESTION 32

1. Which of the following is an example of a genotype?

   		a. Blood type O
   		b. Curly hair
   		c. Dwarfism is defined as an adult 4’ 10” or shorter
   		d. Someone has two copies of the allele for brown eyes, BB

2 points   

QUESTION 33

1. In the table above, what does the word “stop” mean?

   		a. The ribosome will stop and release the completed peptide
   		b. The RNA polymerase will stop transcribing the gene
   		c. Mutations will not occur here
   		d. Primary transcript modification stops

2 points   

QUESTION 34

1. Which of the following does not occur in prokaryotic gene expression, but does in eukaryotic gene expression?

   		a. mRNA, tRNA, and rRNA are transcribed.
   		b. RNA polymerase binds to the promoter.
   		c. A poly-A tail is added to the 3' end of an mRNA and a cap is added to the 5' end.
   		d. Transcription can begin as soon as translation has begun even a little.

2 points   

QUESTION 35

1. Small nuclear RNAs, or snRNAs, have several functions including:

   		a. Preventing translation of mRNAs
   		b. Preventing transcription of new mRNAs
   		c. Cutting out introns during RNA processing
   		d. Preventing the DNA from unwinding

2 points   

QUESTION 36

1. This pedigree is for a family with Marfan syndrome. Marfan syndrome causes abnormal skeletal growth, long limbs, excessive height and sometimes heart defects. Dark-colored symbols are individuals affected with the disease, light symbols are phenotypically normal. Squares are males, circles are females. Using the pedigree, does Marfan syndrome look like it is dominant or recessive?

   		a. Dominant
   		b. Recessive
   		c. Co-dominant
   		d. Not enough information given

2 points   

QUESTION 37

1. Which enzyme catalyzes the elongation of a DNA strand in the 5' → 3' direction?

   		a. primase
   		b. DNA ligase
   		c. DNA polymerase
   		d. Topoisomerase

Waterways puts much emphasis on cash flow when it plans for capital investments. The company chose its discount rate of 8% based on the rate of return it must pay its owners and creditors. Using that rate, Waterways then uses different methods to determine the best decisions for making capital outlays. This year Waterways is considering buying five new backhoes to replace the backhoes it now has. The new backhoes are faster, cost less to run, provide for more accurate trench digging, have comfort features for the operators, and have 1-year maintenance agreements to go with them. The old backhoes are working just fine, but they do require considerable maintenance. The backhoe operators are very familiar with the old backhoes and would need to learn some new skills to use the new backhoes. The following information is available to use in deciding whether to purchase the new backhoes. Old Backhoes New Backhoes Purchase cost when new $88,700 $199,857 Salvage value now $42,100 Investment in major overhaul needed in next year $55,986 Salvage value in 8 years $15,000 $91,000 Remaining life 8 years 8 years Net cash flow generated each year $30,100 $43,700 Click here to view PV table. (a) Evaluate in the following ways whether to purchase the new equipment or overhaul the old equipment. (Hint: For the old machine, the initial investment is the cost of the overhaul. For the new machine, subtract the salvage value of the old machine to determine the initial cost of the investment.) (1) Using the net present value method for buying new or keeping the old. (For calculation purposes, use 5 decimal places as displayed in the factor table provided. If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round final answer to 0 decimal places, e.g. 5,275.) New Backhoes Old Backhoes Net Present Value $ $ Waterways should equipment. (2) Using the payback method for each choice. (Hint: For the old machine, evaluate the payback of an overhaul.) (Round answers to 2 decimal places, e.g. 1.25) New Backhoes Old Backhoes Payback Period years years Waterways should equipment. (3) Comparing the profitability index for each choice. (Round answers to 2 decimal places, e.g. 1.25) New Backhoes Old Backhoes Profitability Index Waterways should equipment. Calculate the internal rate of return factor for the new and old blackhoes. (Round answers to 5 decimal places, e.g. 5.27647.) New Backhoes Old Backhoes IRR Factor (4) Comparing the internal rate of return for each choice to the required 8% discount rate. Waterways should equipment.

College administrators want to know if students would be willing to pay a new fee if most of it would be budgeted for Student Activities. A random sample of 632 students resulted in 516 that would be willing to pay the new fee. Construct a 90% Confidence Interval estimate for the proportion of students willing to pay the new fee.