Question

Abacus trackers cost $200 up front the 80 per year to maintain, they will last four...

Abacus trackers cost $200 up front the 80 per year to maintain, they will last four years, Brittle trackers costs $400 and $70 to maintain, and they will last 9 years. Use a T-bond of 3.5% to justify your answer. Use EAA methodology.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Select the tracker which is having least Equated PV of Cashoutflows

Equated PV of Cash outflows for Abacus Tracker:

Equated PV of Cash outflows for Brittle Tracker:

Select Brittle Tracker as the Equarted PV of Cash Outflows is less.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Belanger Construction is considering the following project. The project has an up-front cost and will also...
Belanger Construction is considering the following project. The project has an up-front cost and will also generate the following subsequent cash flows:             t = 1      $400             t = 2      500             t = 3      200 The project’s payback is 1.5 years, and it has a cost of capital of 10 percent. What is the project’s modified internal rate of return (MIRR)?
Johnson Jets is considering two mutually exclusive projects. Project A has an up-front cost of $124,000...
Johnson Jets is considering two mutually exclusive projects. Project A has an up-front cost of $124,000 (CF0 = -124,000), and produces positive after-tax cash inflows of $30,000 a year at the end of each of the next six years. Project B has an up-front cost of $59,000(CF0 = -59,000) and produces after-tax cash inflows of $20,000 a year at the end of the next four years. Assuming the cost of capital is 10.5%, 1. Compute the equivalent annual annuity of...
A project costs $2,513 up front (year 0), and its net cash flows are expected to...
A project costs $2,513 up front (year 0), and its net cash flows are expected to be +$867 per year for 8 years (with the first cash flow occurring one year from today). If the WACC is 12%, the project's NPV is $_________. Acorp's outstanding bonds have a 4.9% coupon bond with 6 months remaining until maturity is currently trading at $992.9. The firm's marginal tax rate is 30%. Assume semi-annual coupon payments. The company's after-tax cost of debt is__________%.
You are considering opening a new plant. The plant will cost $ 97.5 million up front...
You are considering opening a new plant. The plant will cost $ 97.5 million up front and will take one year to build. After that it is expected to produce profits of $ 28.1 million at the end of every year of production​ (starting two years from​ now). The cash flows are expected to last forever. Calculate the NPV of this investment opportunity if your cost of capital is 7.9 %. Should you make the​ investment? Calculate the IRR and...
You are considering opening a new plant. The plant will cost $102.8 million up front and...
You are considering opening a new plant. The plant will cost $102.8 million up front and will take one year to build. After that it is expected to produce profits of $28.8 million at the end of every year of production​ (starting two years from​ now). The cash flows are expected to last forever. Calculate the NPV of this investment opportunity if your cost of capital is 8.7%. Should you make the​ investment? Calculate the IRR and use it to...
Q11-4: Last Group has a rental cost of €25,000 per month with a four-year lease term....
Q11-4: Last Group has a rental cost of €25,000 per month with a four-year lease term. Casual staff are employed on a weekly basis to carry out telephone sales. The cost of casual staff is €12,000 per month and telephone call costs are €5,000 per month. An offshore call central point has offered to carry out the telephone sales activity from its own premises and using its own staff and telephone services for a fixed payment of €15,000 per month....
A potential new project involves an up-front purchase of equipment that would cost $979. The equipment...
A potential new project involves an up-front purchase of equipment that would cost $979. The equipment would be depreciated on a straight-line basis over its 3 year useful life to a $200 book value. The firm's tax rate is 30%. As part of the capital budgeting process, you are asked by your boss to determine the annual net cash flow impact of the asset's depreciation. You should indicate that the cash flow impact per year (in each of years 1...
A possible job involves an up-front purchase of equipment that would cost $988. The equipment would...
A possible job involves an up-front purchase of equipment that would cost $988. The equipment would be depreciated on a straight-line basis over its 3 year useful life to a $200 book value. The firm's tax rate is 30%. As part of the capital budgeting process, you are asked by your boss to determine the annual net cash flow impact of the asset's depreciation. You should indicate that the cash flow impact per year (in each of years 1 through...
A potential new project involves an up-front purchase of equipment that would cost $980. The equipment...
A potential new project involves an up-front purchase of equipment that would cost $980. The equipment would be depreciated on a straight-line basis over its 3 year useful life to a $200 book value. The firm's tax rate is 30%. As part of the capital budgeting process, you are asked by your boss to determine the annual net cash flow impact of the asset's depreciation. You should indicate that the cash flow impact per year (in each of years 1...
Compute for the missing amount. The total maintenance costs of Silver Company in the last four...
Compute for the missing amount. The total maintenance costs of Silver Company in the last four months are presented below: Month Machine hours                        Maintenance cost                 January                    7, 200                                      P450, 000                 February                  6, 800                                      P422, 000                 March                      7, 000                                      P440, 000                 April                        6, 400                                      P418, 000 Requirements: a.Variable cost per machine hour b. Total fixed cost c.Budgeted maintenance cost in May if the company is planning to use 7, 500 hours. d. Budgeted maintenance cost in May...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT