Calculate the future equivalent of incomes

Assignment Help Business Economics
Reference no: EM133084320

A building will be constructed in five years. The yearly construction expenditures during these five years are expected to be $400,000 per year. The building's life is 40 years after the end of construction. The yearly net rental income during these 40 years is anticipated to be $200,000. Assuming an interest rate of 10% in the first 20 years (including 5 years of construction time and 15 years of the building's life) and an interest rate of 12% in the remaining 25 years of the building's life, calculate the future equivalent of incomes and expenditures at the end of its life.

Reference no: EM133084320

Questions Cloud

Determine the system should be installed : For each of the following problems, (a) draw the cash flow diagram (as needed); (b) present clean and clear manual solutions to the problem; (c) highlight the f
What should inventory be in order to be in equilibrium : What should inventory be in order to be in equilibrium?
How do you keep data secure and protected : Imagine that you interview for a data analyst role at a local ice cream company. The hiring manager explains that the company needs a data analyst because they
What is the capital recovery cost for a machine : What is the capital recovery cost for a machine costing $420,000 with a life of 6 years and a salvage value of 20% of the initial cost? The rate used by the fir
Calculate the future equivalent of incomes : A building will be constructed in five years. The yearly construction expenditures during these five years are expected to be $400,000 per year.
Deals with climate and environment : The United Nations has continued to retain you as a consultant for a project that deals with climate and the environment.
Example of an ideal market : Suppose you are an American student and you are about to obtain your MBA and start looking for a job. An economist would say that you are about to enter the job
What is unemployment rate : Suppose an economy has 10,000 people who are not working but looking and available for work and 90,000 people who are working. What is its unemployment rate?
Pricing policies in commodity markets : How can we explain asymmetric consumers' pricing policies in commodity markets?

Reviews

Write a Review

Business Economics Questions & Answers

  Attractions for manufacturers to locate to alabama

Training and workforce development are huge attractions for manufacturers to locate to Alabama. If this trend continues as statistics suggest

  Explain the concept of devaluation

Explain the concept of devaluation, and explain the effect devaluation has on the price of a country's imports. What some effects on the industry? Buying and selling countries? Give an example that supports your claims.

  Sticky-price model-the higher the average rate of inflation

Using the sticky-price model, the higher the average rate of inflation, the more frequently firms must adjust their prices, which implies that a high rate of inflation: Starting from long-run equilibrium in the dynamic model of aggregate demand and a..

  What can you tell me about elmer preferences

Elmer Fudd likes to hunt “wabbits” but also likes to hunt duck. His utility function can be expressed as U(W,D)= 1/(-(2W^2+D^2 )^2 ). Write the tangency condition, what can you tell me about Elmer’s preferences? Suppose that the price of hunting Duck..

  Monopsony and human capital

Identify those who gave us the concepts of monopsony and human capital.

  Which is the better deal for you if the annual interest rate

Suppose you are buying a car. You go to one dealer who works a deal in which you would pay $3,740 each year for three (3) for the car. Another deal gives you a deal in which you would pay $2,870 each year for the four (4) years. Which is the better d..

  Determining the market for air travel

Oil prices increased by 90% during the first half of 2008 just when the U.S. recession was taking hold - in other words the economy was on a decline.

  Preferred customer and the customer is charged at cost

An apparel manufacturing plant has estimated the variable cost to be $4.50 per unit. Fixed costs are $500,000 per year. Forty percent of its business is with one preferred customer and the customer is charged at cost. If 150,000 total units are sold ..

  What is the null and alternative hypothesis

What is the null and alternative hypothesis, and what is the hypothesis mean?

  Annual nominal gdp and and population for france

Following table shows the annual nominal GDP and and population for France. Based on the data below, which of the following are correct?

  Depreciation charge in year three is nearest

A machine with a useful 10 year life is to be depreciated by the MACRS method over 7 years. The machine has a first cost of $35,000 with a $5,000 salvage value. Its annual operating cost is $7,000 per year. The depreciation charge in year three is ne..

  What would be the second reason

What would be the second reason? Assume that the marginal cost curve is linear. (Hint: The second reason relates to average fixed cost)

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