Find the probability that the machine will be profitable

Reference no: EM13261108

Davis Hospital, a non-profit entity, wants to buy a machine for $135,000, which will run for 6 years. The savings from the machine are uncertain, with an expected value of $35,000 per year and a standard deviation of $10,000. The hospital uses 10% as the discount rate and it does not pay any income taxes. Find the probability that the machine will be profitable (that is its NPV > 0). Should the hospital buy the machine?

Reference no: EM13261108

Questions Cloud

Calculate output power of the motor at rotational frequency : 13A flows through the coil of a DC motor. The coil has a length of 0.4m and 0.3m. The coil has 36 windings and a flux of 0.21 Wb. If its rotational frequency is 936 r/min, calculate output power of the motor.

What is the effective voltage if the waveform is sinusoidal : Calculate The Average voltage generated in 6 turn full pitch coil of a 25 cycle alternator if the flux per pole is 7.2 x 10^5 maxwells. What is the effective voltage if the waveform is sinusoidal.

Calculate the equity capital ratio : Tenth National Bank has common stock of $2 million, retained earnings of $5 million, loan loss reserves of $3 million, and subordinated notes outstanding in the amount of $4 million. Total bank assets are $105 million. Using Excel please calculate..

For what value of load resistance is gain reduced by factor : An active-loaded NMOS differential amplifier operates with a bias current I of 100 microamperes. The NMOS transistors are operated at Vov=0.2 V and the PMOS devices at |Vov|=0.3V. The Early voltages are 20 V for the NMOS

Find the probability that the machine will be profitable : Find the probability that the machine will be profitable (that is its NPV > 0). Should the hospital buy the machine?

Determine minimum bandwidth needed to transmit final data : In a satellite radio system, 128 stations of stereo quality are to be packaged in one data stream. For each station, two(left and right) signals of bandwidth 15,000 hz are sampled, quantized, and binary coded into PCM signals.

What is the incremental costs associated with producing : Suppose this action will increase sales to 300,000 jars of sauce. What is the incremental costs associated with producing an extra 72,500 jars of sauce?

Find the inverse laplace transforms of the functions : 1- find the inverse Laplace transforms of the following functions: A- f1(s)= 50(s+10)/((s+5)(s+20)) b- f2(s)= (2s^2)((s+200)(s+500)) 2- find the inverse Laplace transforms of the following functions and sketch their waveforms for β >0 : a- f1(s)= (β(..

What is the pressure in the artery : At a given instant, the blood pressure in the heart is 1.8 x 104 Pa. If an artery in the brain is 0.37 m above the heart, what is the pressure in the artery

User Account

All Pages