Determine the equivalent total present worth

Assignment Help Business Economics
Reference no: EM131002313

A plant superintendent has arranged to purchase an additive through a 6-year contract at $5,000 per year, starting 1 year from now. Afterwards, he expects the annual price to increase by 3% per year thereafter for the next 12 years. Additionally, an initial investment of $70,000 was made now to prepare a site suitable for the contractor to deliver the additive. Use i=8% to determine the equivalent total present worth for all these cash flows.

Reference no: EM131002313

Questions Cloud

Events to affect the market equilibrium price : Suppose you are the manager of a California winery. How would you expect the following events to affect the market equilibrium price (up or down) you receive for a bottle of wine? Please state the shift (leftward or rightward) of demand or supply.
Develop a global? mindset : Which of the following methods will NOT help managers develop a global? mindset?
What amount will jennings retained earnings : By what amount will Jennings' retained earnings decline if it now sells the remaining 1 million treasury shares at $67 per share?
Demand for a softback managerial economics text : Demand for a softback managerial economics text is given by Q=20,000-300P. The book is initially priced at $30. Compute the point price elasticity of demand at P= $30. If the objective is to increase total revenue, should the price be increased or de..
Determine the equivalent total present worth : A plant superintendent has arranged to purchase an additive through a 6-year contract at $5,000 per year, starting 1 year from now. Afterwards, he expects the annual price to increase by 3% per year thereafter for the next 12 years. Additionally, an ..
Only two firms producing door stopers : Wolfe and Baker are the ONLY two firms producing door stopers because of such a small market in their area and both firms are profit maximizing. They have a marginal cost (MC) of $8 and have NO fixed cost (FC = $0).  On graph created above, mark the ..
Describe a different sdlc model : This research paper will compare and contrast Systems Development Life Cycle (SDLC Models). The research paper must be submitted using Safe Assign. describe a different SDLC Model
Discuss errors in perception and selection that interviewers : Untrained interviewers can make mistakes that are very costly to the organization." Discuss errors in perception and selection that interviewers can make and how to avoid them.
What is the impact this has had on chinas economy : During the last decade, outsourcing often translated in offshoring of product buys. One popular location to buy product offshore was China. Why was China such a popular spot to buy labor intensive products? Why are many people leaving China and bring..

Reviews

Write a Review

Business Economics Questions & Answers

  Explain how does the market system efficiently perform

Explain how does the market system efficiently perform the functions of communication, coordination and motivation in the distribution of resouces to comsumers.

  When firms are deciding on the size of stock

DeAngelo Corp.'s projected net income is $150.0 million, its target capital structure is 25% debt and 75% equity, and its target payout ratio is 65%. DeAngelo has more positive NPV projects than it can finance without issuing new stock.

  How does affect perception of a monopoly

How does definition of a market, or for that matter, a business strategy, affect that perception of a monopoly.

  Merged firm would have volume-price elasticity of demand

Two clinics want to merge. The price elasticity of demand is -0.20, and each clinic has fixed costs of $60,000. One clinic has a volume of 7,200, marginal costs of $60, and a market share of 2 percent. The other clinic has a volume of 10,800, margina..

  Overseas producers can sell in the domestic market

If overseas producers can sell in the domestic market Illustrate what is the equilibrium price. Illustrate what is the equilibrium quantity.

  Find his optimal bundle of coffee and donuts

Billie Joe loves Krispy Kreme donuts and coffee. Billie Joe likes to eat 3 donuts (D) for each cup of coffee (C) he drinks. His utility function is: U = min(0.333D, C). The price of each donut is $0.60 and the price of coffee is $2.20. Given Billie J..

  Draw a graph of money market equilibrium

Draw a graph of money market equilibrium. Is the real or nominal interest rate on the axis? Explain why. Let’s say the Fed wants to lower the nominal interest rate. Use your graph to show how they do this. Explain. Define monetary neutrality. Explain..

  In what ways does this model reflect reality

McNair's Wheel of Retailing is a widely used model to describe the way in which retail outlets develop over time. In what ways does this model reflect reality? Can you think of situations where retailers do not follow this model?

  Products at the prevailing market price

Why are some producers forced to sell their products at the prevailing market price? High degree of similarity to competitor's products.

  Development of nuclear weapons-agreement is a bad deal

After a long period of negotiations, it would appear that the United States and Iran have come to an agreement on the timing and scope of Iran's development of nuclear weapons. Mention and discuss in detail two reasons why the government of Israel th..

  Higher load be sign of problems in the insurance market

Economists often assume that insurers set premiums (nearly) equal to the AFP for that plan. Is that an accurate assumption? Is a higher “load” on insurance premiums necessarily a bad thing for consumers? When might a higher load be a sign of problems..

  What effect does the current supply

In a few sentences, what effect does the current supply and current demand have on this product.

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