What is the net present worth of this investment

Assignment Help Financial Management
Reference no: EM131954844

"A manufacturing company is considering investing in a new cutting machine that will cost $119,000 and has an annual maintenance cost of $17,000. There is no salvage value for the machine. If the machine will last for a total of 5 years under these conditions and the costs do not change, what is the net present worth (NPW) of this investment at an interest rate of 17.4%? Even though all of the dollar values are costs, express your answer as a positive number (i.e., net present cost)."

Reference no: EM131954844

Questions Cloud

Construct amortization schedule for first six payments : Calculate your monthly payments on this mortgage. Construct the amortization schedule for the first six payments.
Affected by increase in reserve requirement ratio : Should There Be One Global Central Bank? How is money supply growth affected by an increase in the reserve requirement ratio?
Find the present value of the annuity of the first payment : Carl receives a 15 year annuity which makes payments at the beginning of each month. The payments during the first year are 10 dollar per month.
What is the current value of the lease : Your car dealer is willing to lease you a new car for $309 a month for 60 months. Payments are due on the first day of each month you cost of money is 4.9.
What is the net present worth of this investment : what is the net present worth (NPW) of this investment at an interest rate of 17.4%?
Calculate the annual equivalent shifted uniform series cost : A car company announced that it would offer three years of free maintenance after purchase for its new models that adds regular maintenance service.
Assume zero discount rate : What percentage of the firm would you have to sell to an investor to raise this $5M? Assume a zero discount rate.
Determine by just knowing the return on equity : What can you learn about a firm by using the Du Pont identity that you cannot determine by just knowing the return on equity?
What are the monthly rates each year : A car rental agency which leases cars to another firm buy car for $9,000 and sells them for $6,000 two years later. It charges a monthly rate the second year.

Reviews

Write a Review

Financial Management Questions & Answers

  Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

  Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

  Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

  Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

  Business finance task - capital budgeting

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

  Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

  Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

  Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

  Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

  Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

  Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

  Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.

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