Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $870 per set and have a variable cost of $470 per set. The company has spent $157,000 for a marketing study that determined the company will sell 61,000 sets per year for seven years. The marketing study also determined that the company will lose sales of 10,200 sets of its high-priced clubs. The high-priced clubs sell at $1,170 and have variable costs of $770. The company will also increase sales of its cheap clubs by 11,700 sets. The cheap clubs sell for $510 and have variable costs of $265 per set. The fixed costs each year will be $9,170,000. The company has also spent $1,180,000 on research and development for the new clubs. The plant and equipment required will cost $29,190,000 and will be depreciated on a straight-line basis. The new clubs will also require an increase in net working capital of $1,370,000 that will be returned at the end of the project. The tax rate is 30 percent, and the cost of capital is 10 percent. Suppose you feel that the values are accurate to within only ±10 percent.
What are the best-case and worst-case NPVs? (Hint: The price and variable costs for the two existing sets of clubs are known with certainty; only the sales gained or lost are uncertain.) (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
A natural monopoly can charge a price above MC where MC = MR, because
What is the value of a three-month European call option on the futures with a strike price of 42 if the risk-free interest rate is 7% per annum?
Explain how you could use foreign financing for your business in a manner that would reduce your exposure to exchange rate risk. Be specific. Given that you receive periodic payments in foreign currency for your exports, explain how you could effecti..
The first payment of a perpetuity-immediate is 60. Subsequent payments decrease by 1 per year until they reach a level of k. Payments remain constant at k thereafter. The present value of the perpetuity is equal to the present value of a perpetuity i..
The primary function of financial markets is to:
A friend of yours needs to decide whether or not to invest in multiyear project. The basis of decision to invest will be whether project has a positive value
Which of the following is correct in regard to distinctions between a U.S. Treasury Bills, Treasury notes and a Treasury bonds?
Christopher Electronics bought new machinery for $5,015,000 million. What is the payback period for this project?
Nally, Inc., is considering a project that will result in initial aftertax cash savings of $6.9 million at the end of the first year, and these savings will grow at a rate of 3 percent per year indefinitely. What is the maximum cost Nally would be wi..
What is the weighted average cost of capital for Ampex - Show how the events change the discount rate applicable to an expansion of an existing restaurant chain.
Why does the price of the bond decline (for premium bonds) and increase (for discount bonds) as maturity nears?
Pick any stock and estimate its value based on at least two competitors’ PE ratios.
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd