What price each stereo be sold for the company to achieve

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Question 1: Glen Oak Products will produce 60,000 units next year. Variable costs are 50% of sales. Fixed costs are $120,000. At what price each stereo be sold for the company to achieve an EBIT of $95,000?

a. $6.57

b. $6.87

c. $7.17

d. $7.47

e. $7.77

Question 2: Klein Pharmacy has a project which has the following cash flows.

Year 0 = -$200,000

Year 1 = $50,000

Year 2 = $100,000

Year 3 = $150,000

Year 4 = $40,000

Year 5 = $25,000

The cost of capital is 10%. What is the project's net present value?

a. $83,640

b. $134,703

c. $68,117

d. $73,395

Question 3: If you are considering the purchase of an investment that would pay you $5,000 per year for Years 1-5, $3,000 per year for Years 6-8, and $2,000 per year for Years 9 and 10. If you require a 14 percent rate of return, and cash flows occur at the end of each year, then how much should you be willing to pay for this investment?

a. $15,819.27

b. $21,937.26

c. $32,415.85

d. $38,000.00

e. $52,815.71

Reference no: EM132554034

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