Calculate the pw of the revenue stream

Assignment Help Business Economics
Reference no: EM131810408

Due to competition from a new plastic, revenues for the mainstay product of Toys-R-Plastic are declining at 5% per year. Revenues will be $2M for this year. The product will be discontinued at the end of year 6. If the firm's interest rate is 10%, calculate the PW of the revenue stream.

Reference no: EM131810408

Questions Cloud

Whats the future value of the same annuity due : Future Value of an Annuity Due If the future value of an ordinary, 6-year annuity is $6,900 and interest rates are 7 percent.
Find the probabilities that an individual will do : Find the probabilities that an individual will do the P(Fail both the first and second tests) and P(Fail three times in a row).
What must her salary be to have the same purchasing : If inflation is 4% each year, what must her salary be to have the same purchasing power in year 10? Year 20? Year 30? Year 40?
Prepare the entry necessary to achieve this objective : Prepare the entry necessary to achieve this reporting objective. How would Fuzzy Monkey's 2016 statement of cash flows be affected by this investment?
Calculate the pw of the revenue stream : The product will be discontinued at the end of year 6. If the firm's interest rate is 10%, calculate the PW of the revenue stream.
Assemble widgets has kept pace with inflation : The cost of machinery used to assemble widgets has kept pace with inflation. Using Exhibit 15.1, calculate the cost, in 2001 dollars
Find the expected cash balance at the end of april : Cash can be borrowed in $1,000 increments from the local bank (assume no interest charges). Calculate the expected cash balance at the end of April
Why would you make or buy plain cakes from nausori bakery : If you are the manager of Laucala branch, would you make or buy plain cakes from Nausori Bakery? Show all necessary calculations.
Determine the after-tax net present worth of assets : The company uses an after-tax MARR rate of 12% and is in the 35% tax bracket. Determine the after-tax net present worth of this asset over the 5-year service pe

Reviews

Write a Review

Business Economics Questions & Answers

  Conflicting political economic perspectives exist

Conflicting political economic perspectives exist between many nations. Using the United States , Japan, and the former Soviet Union as examples, describe how each nation views capitalism and name at least 2 policy tools used by each to advance their..

  What is the condition for efficiency in production

Consider a country in autarky with only two inputs, capital (K) and labor (L), that produces only two goods X and Y. What is the condition for efficiency in production (allocation of inputs) What are the two other conditions necessary for this econom..

  What are effects of increasing taxes in short and medium run

The US government decides to reduce the government budget deficit by increasing taxes and keeping government expenditures at the existing level. What are the effects of increasing taxes in the short and medium run for the US economy? Is it possible t..

  Fed conduct contractionary monetary policy

In which of the following situations would the Fed conduct contractionary monetary policy?

  Q in 1999 mercedes- benz usa assumes a new pricing policy

q. in 1999 mercedes- benz usa assumes a new pricing policy which it called nfp negotiation- free process that sought to

  Explain briefly the ethicl situation

Explain briefly the ethical situation. What are the all the different actions you could have taken. What are the consequences of each of these actions.

  Increase mongolias rate of economic growth

How might freeing up dead capital have helped to increase Mongolia’s rate of economic growth? What type of investment would foreign residents undertake if they were to purchase a small fraction of the shares of stocks owned by Mongolia’s residents?

  Illustrate what is each firm equilibrium output

Illustrate what is each firm's equilibrium output and profit if they behave noncooperatively. Use the Cournot model. Draw the firms' reaction curves and show the equilibrium.

  Reduced corporate earnings lead to cuts in travel budgets

What effect, if any, does each of the following events have on the price elasticity of demand for corporate-owned jets? The cost of manufacturing corporate jets rises. Reduced corporate earnings lead to cuts in travel budgets and increase the share o..

  Interpret the coefficient on all-star

Interpret the R2. (b) Interpret the coefficient on All-Star.

  Find the monopolists profit maximizing price

A newspaper has a monopoly on the local news market in a town. The market demand is given by P=1.70-Q/20,000, making the marginal revenue MR=1.70-Q/10,000. The marginal cost is constant at equal to 0.80. The fixed cost is 2,000. So, the total cost is..

  Overvalued currency and a fixed exchange rate

Suppose that in response to a severe recession a country with an overvalued currency and a fixed exchange rate does, in fact, move to a floating exchange rate system. This move to a floating exchange rate will cause the exchange rate to:

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