What price should more tech charge for the subsidiary

Reference no: EM132158767

Question: More Tech Drilling is considering the sale of its Alaskan subsidiary to another company. The subsidiary is expected to produce profits of $800,000 next year, which drops by $50,000 per year for the following 14 years. If More Tech's interest rate is 12%, what price should More Tech charge for the subsidiary? The response must be typed, single spaced, must be in times new roman font (size 12) and must follow the APA format.

Reference no: EM132158767

Questions Cloud

Determine the investment pw : We-Clean-U will receive $32,000 each year for 15 years from the sale of its newest soap, Rub-A-Dub Dub. The initial investment is $150,000.

Why private provision of a public good : Explain why private provision of a public good may result in positive provision of the public good but less than the efficient amount.

What is the press present worth at an interest rate : A new drill press has a first cost of $10,000. The net annual income is $1500 the first year, which decreases by $250 each year thereafter.

Do you have a personal mission statement : Do you think that Weber's and Fayol's view of the workforce would be appealing to millennials?

What price should more tech charge for the subsidiary : More Tech Drilling is considering the sale of its Alaskan subsidiary to another company. The subsidiary is expected to produce profits of $800,000 next year.

What is the pw of the electric power-generating project : What is the PW (at i = 10%) of the following electric power-generating project? There is a $180,000 overhaul cost in year 8. The first cost is $420,000.

What is the present worth of the entire years : A project has a first cost of $10,000, net annual benefits of $2000, and a salvage value after 10 years of $3000. The project will be replaced identically.

Do the actions of buyers determine the actions of sellers : Does this mean that buyers and sellers do different things in the first four levels of the CMMM and do the same thing in the last two levels of the CMMM?

Determine each table residual value : Pass-Time Pool Hall may buy 10 of the finest slate pool tables available. Each table will cost $12,000 and have an unknown residual value.

User Account

All Pages