What is equivalent annual cost

Assignment Help Financial Management

Reference no: EM132036650

1. Champion Bakers uses specialized ovens to bake its bread. One oven costs $870,000 and lasts about 3 years before it needs to be replaced. The annual operating cost per oven is $10,000. What is the equivalent annual cost of an oven if the required rate of return is 11 percent? (Round your answer to whole dollars)

2. You are considering an annuity which costs $99,246 today. The annuity pays $7,600 a year at an annual interest rate of 6.5 percent. What is the length of the annuity time period? 30.00 years 44.78 years 28.90 years 31.00 years 15.12 years.

Reference no: EM132036650

Questions Cloud

Store owner indifferent between the new and old leases : What new lease payment would make the store owner indifferent between the new and old leases?

Working in australia on temporary resident visa : Tom is 38, has been working in Australia on a temporary resident visa, and has received superannuation during his time here.

What is the minimum number of bonds : The bonds will be priced to yield 5 percent. What is the minimum number of bonds it must sell to raise the $10 million it needs?

Investments will be counted under income test : How much income from his investments will be counted under the Income Test?

What is equivalent annual cost : What is the equivalent annual cost of an oven if the required rate of return is 11 percent?

What is discounted payback period : What is the discounted payback period if the required rate of return is 7 percent?

Discuss how microfinance affects households : Why do we need to include convexity into duration equation? Discuss how microfinance affects households.

The correlation between asset returns : Lower (less positive and more negative) the correlation between asset returns, ________.

Discuss how grameen bank classic great model work : discuss how grameen bank classic great model work

User Account

All Pages