What would be the additional annual revenue for method a

Assignment Help Econometrics
Reference no: EM13231955

A firm is considering two different methods of solving a production problem. Both methods are expected to be obsolete in six years. Method A would cost $80,000 initially and have annual operating costs of $22,000. Method B would cost %52,000 initially and have annual operating costs of $17,000. The salvage value realized with method A would be $20,000 and with method B would be $15,000. Method A would generate $16,000 of revenue per year more than Method B. Investments in both methods depreciate as a 5 year MACRS property class. Marginal tax = 40%. MARR=20%. What would be the additional annual revenue for method A such that the firm would be indifferent in its choice of method?

Reference no: EM13231955

Questions Cloud

Sael electronics with printed circuit : BUYU Manufacturing has been contracted to provide SAEL Electronics with printed circuit and motherboards (PC) boards under the following term
Calculate the marginal opportunity cost of each combination : Suppose a second nation has the following data. Plot the PPC, and then determine which nation has the comparative advantage in which activity. Show whether the two nations can gain from specialization and trade.
Describe the components of the ethernet frame in detail : Describe the components of the Ethernet frame in detail
State the b oxidation pathway are similar to three reactions : The first three reactions of the b oxidation pathway are similar to three reactions in the Kreb's cycle. Which three and why are they similar
What would be the additional annual revenue for method a : A firm is considering two different methods of solving a production problem. Both methods are expected to be obsolete in six years. Method A would cost $80,000 initially and have annual operating costs of $22,000. Method B would cost %52,000
Technology and innovation : Technology and Innovation
Define the hypothesis test : A machine is designed to fill jars with 16 ounces of jelly beans. A buyer suspects that the machine is not filling the jars completely, Clearly identify the necessary steps in your hypothesis test
Compute the mode for these sample data : Given this sample data, suppose the manager wishes to give discounts to golfers inthe top quartile. What should the minimum number of rounds played be to receive a discount?
Prepare a project task list include all the detailed tasks : You are the data transformation specialist for the first data warehouse project in an airlines company. Prepare a project task list to include all the detailed tasks needed for data extraction and transformation.

Reviews

Write a Review

Econometrics Questions & Answers

  Design a simple econometric research project

Design a simple econometric research project

  Multiplicative decomposition method

Multiplicative decomposition method

  Market for cigarettes

The Australian government administers two programs that affect the market for cigarettes.

  Solve the forecast model

Solve the forecast model

  What are the marginal abatement cost functions

What are the marginal abatement cost functions for each of the two areas? Calculate the loss in the two areas due to over-control (for the rural area) and under-control (for the urban area).

  Write the t statistic for testing the null hypothesis

Explain why this model violates the assumption of no perfect collinearity.  Write the t statistic for testing the null hypothesis

  What is economics system

What is economics system? What are the types of economics system? Briefly explain each type of economics system by giving examples of nations that are close to each type

  Multiple choice questions related to market concentration

Determine when a competitively produced product generates negative externalities in production, the industry will,

  Calculating number of units produced by firm

Assume a company has the following production function: Q = 100 K.5 L1 . Currently, the company hires 1,000 workers and employs 100 units of capital.

  Question about mobile commerce

M-commerce also known as mobile commerce is being lumped in with several strategic internet plans. Explain some of the industries that are likely to use mobile commerce and how it is working for them.

  Calculating the average days past due and average flow time

Auto Data manufactures custom engineering testing machine. The following 5-orders are currently in the design department:

  Mechanism of an english auction and second price auction

Briefly discuss the difference between mechanism of an oral or English auction and a Vickrey or second price auction.

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