Calculate capital recovery and annual revenue required

Assignment Help Microeconomics
Reference no: EM131004388

1. Jim, the owner of Computers-on-Wheels, an on-site repair service, just purchased a $20,000 diagnostics system and software for PCs, laptops, and LANs. During the expected 5-year life, he determines that the annual recovery amount for this investment is $20,000/5 = $4000.

(a) Explain why Jim has mistakenly underestimated the annual increase needed in revenue.

(b) Determine the required annual revenue increase for a 15% per year return.

2. A 600-ton press used to produce composite- material fuel cell components for automobiles using proton exchange membrane (PEM) technology can reduce the weight of enclosure parts up to 75%. At MARR = 12% per year, calculate (a) capital recovery and (b) annual revenue required.

Installed cost = $-3.8 million n = 12 years Salvage value = $250,000

Annual operating costs = $350,000 to start increasing by $25,000 per year

Reference no: EM131004388

Questions Cloud

Find an explicit expression for each given integral : Without integrating find an explicit expression for each integral. a. 0∫∞e-(s + 5)t dt, b. 0∫∞e-st sin 3t dt and c. 0∫∞ t2e-(s - 2)t dt.
Plot a graph of aw versus interest rate on the spreadsheet : Equipment needed at a Valero Corporation refinery for the conversion of corn stock to ethanol, a cleaner- burning gasoline additive, will cost $175,000 and have net cash flows of $35,000 the first year, increasing by $10,000 per year over the life..
Write summary on the film radical grace : Watch the film Radical Grace and write a two page summary or reflection. It is playing Saturday, March 19th, 2016 at 10pm on CBC News Network
Describe at least two benefits of using enterprise systems : Define a fault-tolerant computer system and a high-availability computer system. How do they differ? When would each be used?
Calculate capital recovery and annual revenue required : Jim, the owner of Computers-on-Wheels, an on-site repair service, just purchased a $20,000 diagnostics system and software for PCs, laptops, and LANs. During the expected 5-year life, he determines that the annual recovery amount for this invest..
Design to evaluate effectiveness of potential intervention : Discuss at least two threats to validity and how you could address these in your evaluation design - Perform a web search to find a measurement tool that you believe would yield the best data for this type of research.
Examine the personality of the main character : After watching the movie Good Will Hunting examine the personality of the main character (Will) through the eyes of first Sigmund Freud and then Carl Jung.
Estimated lives and annual net cash flows vary : Use the PW method at 8% per year to select up to 3 projects from the 4 available ones if no more than $20,000 can be invested. Estimated lives and annual net cash flows vary.
Discuss the merits of the contentions of the parties : Discuss the merits of the contentions of the parties, analyze the outcome(s) and effectiveness of the tactics used by each side, and set forth what alternative actions each side could have pursued to resolve the situation in a better manner.

Reviews

Write a Review

Microeconomics Questions & Answers

  The permanent income hypothesis

to the permanent income hypothesis, households will tend to react to a temporary tax cut by assuming the new tax level will be permanent.

  What will be the trade balance in each country

What is GDP in each economy? If the total value of GDP is consumed and no country borrows from abroad, how much will consumers in each economy spend on each of the goods?

  Explain apparent relationship between entering gpas and

ten students in a graduate program were randomly selected.nbsp their grade point averages gpas when they entered the

  What is the cost of producing 10 units in the short run

Currently, K = 100. What is the cost of producing 10 units in the short run? Hint: first determine how much labor is needed.

  Calculate any depreciation recapture-ordinary losses

An asset with an 8-year ADR class life costs $50,000 and was purchased on January 1, 2001. Calculate any depreciation recapture, ordinary losses, or capital gains associated with selling the equipment on December 31, 2003, for $15,000, $25,000, and $..

  Should computer products accept offer to supply 300000

1. computer products corp. sells peripheral equipment used by both private businesses and the government. due to a

  What is the price elasticity of demand for gasoline

What is your price elasticity of demand for gasoline and why How important is fuel efficiency to you (particularly if you have purchased a car in the past three or four years) Do your driving habits change as the price of gasoline changes

  Implication of demand of law

Your are the chief economic advisor to the King of Terra. The king has observed that while the price of energy has increased 20 percent over the past five years, consumers have actually increased their energy consumption by 10 percent over the sam..

  Why the company thought they would be flatter or steeper

Why does google care weather people think it is large or small? Do highway billboards actually provide competition for Google. Briefly explain. Please state wheather the actual demand were a)to the right or to the left the where the company thou..

  Part 1 annie has an income of 120 an hour popcorn cost 6 a

part 1. annie has an income of 120 an hour popcorn cost 6 a bag and cost 5 a six pack cola.a.draw a graph of annies

  What are the proportions of employed- unemployed

Suppose the adult population over the age of 16 is 237.8 million and the labor force is 153.9 million (of whom 139.1 million are employed). How many people are "not in the labor force?" What are the proportions of employed, unemployed and not in t..

  What size has the higher mark up

Q1:= 7500 - 40 P1 + 25P2 , Q2:= 8000 + 20 P1 - 30 P2 , where Q1 and Q2 are the quantity demanded and P1 and P2 are the prices of first and second model. Determine the quantity/price combination of models that maximizes the producer's profit. What ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd