What is the npv of the project

Assignment Help Business Economics
Reference no: EM131631809

Your are planning to spend some money on product development. It will increase sales and cash flows will rise by $80,000 at the end of the first year, $100,000 at the end of the second year, and $120,000 at the end of the third year. The cost of the development is $280,000.

After few days, you realized you could lower the cost of the innovation to $200,000 but it will take more time to do the work. This means the higher profits and cash flows will be delayed for one year. The investment of $200K will occur today. What is the NPV of the project with the lower cost of innovation ($200,000) and delay?

Reference no: EM131631809

Questions Cloud

Identify a specific segment of criminal justice : Identify a specific segment of criminal justice (e.g., law enforcement, courts, corrections) and describe the organizational culture of that agency.
Stretching the firm accounts payable : Assume that the financial manager is considering stretching the firm's accounts payable by paying its vendors at a later date.
Find the net realizable value of accounts receivable : On January 1, 2013, the accounts receivable balance for Chioda Company was $7,000, The net realizable value of accounts receivable immediately is
What is australias system of governance : What is Australia's system of governance? What is the Australian Constitution?
What is the npv of the project : What is the NPV of the project with the lower cost of innovation ($200,000) and delay?
Why classic urban reform measures have failed accomplishment : Explain why classic urban reform measures have failed the accomplishments hoped for by it's sponsors ?
Explain the precede-proceed model and how does it work : Explain the PRECEDE-PROCEED model and how does it work. Also, why is it very effective in certain types of situations?
Which one do you think will have the greatest application : Which one do you think will have the greatest application to your work here at the Garber Corporation?
What is the depreciation expense : On January 1, 2013, Williams Company purchased a copy machine. What is the depreciation expense for 2014 using double-declining-balance method

Reviews

Write a Review

Business Economics Questions & Answers

  Draw the consumers budget line

Calculate a function M(α), which shows the maximized value of f that can be achieved, given any real number α. Is this function continuous? Assume that a consumer has the utility function U(x,y) = 3x+y, where x and y represent the quantities of two g..

  Does omega operate in perfectly competitive market

Omega Travel competes in the highly competitive market for travel. Consumers know that Omega has the best agents in the industry and offers superior service. Nonetheless, Omega earns zero economic profits because numerous competitors have entered the..

  Households preferences are represented by utility function

Suppose that the household’s preferences are represented by the utility function U(C0, C1)= 100C0^ 0.5 C1^0.25. If the real interest rate is 5 percent, what is the value of the MRS of this household when it has maximized its two-period welfare?

  List two economically important activities not captured

List two economically important activities not captured in GDP. How can externalities cause increases in GDP to not adequately reflect increases in wellbeing?

  Verizon has a monopoly on data plans

Suppose Apple has a monopoly on iPhones and Verizon has a monopoly on data plans. An iPhone without a data plan is worthless, and a data plan without an iPhone is worthless. Thus there is no such thing as a demand for iPhones or a demand for data pla..

  The news for a significant business decision

Research a company that has been in the news for a significant business decision within the last 18 months. Summarize the decision that was made, and state your opinion on whether it was a good or bad move for the company. Post a link to the article ..

  Religious tradition and the principles of democracy

What is the potential tension between any religious tradition and the principles of democracy?

  Savings function and the investment demand function

For each of the following two-variable relationships: i) the consumption function ii) the savings function iii) the investment demand function iv) the multiplier, indicate, a. the dependent variable b.the independent variable c. the nature of the rel..

  Estimate of linear demand at the current price

A mining company is interested in obtaining the demand curve for coal. The firm's research department informs you the price elasticity of demand is -0.68, and the current price and quantity are $41 and 1,206 respectively. Price is measured in dollars..

  Elucidate the price elasticity of demand for nba games

Elucidate the price elasticity of demand for NBA games after the ticket increase. Is demand elastic or inelastic. Is the increase a sound financial move. Why or why not.

  Which factors decrease because of protectionism

Which factors decrease because of protectionism? choices are competition, job security, domestic production, goodwill trade partners, importation of goods.

  Holding money or fixed dollar value assets

For individuals who are holding money or fixed dollar value assets, inflation has the effect of:

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