РЫ В А ПРО В А П Р О Л ДЗАПРОВА ЯЧСМИТНЧСМИТЬБНСМИТНЧС SOLVE STEP BY STEP IN DIGITAL FORMAT Topic: Net Present Value (NPV) and Internal Rate of Return (IRR) Calculate the net cash flow for each investment alternative, taking into account income and expenses and calculate for each one its VAN and IRR and once the above is completed, indicate through a conclusion which of the two is convenient for the company and why. A company from Aguascalientes wants to increase its production, so it has two alternatives, which consist of doubling its installed capacity with semi-automatic equipment or buying modern automatic equipment. The two alternatives have the following cost characteristics: Concept Investment ($) Annual cost of operation ($) Annual net ($) Production gains Observation periods (years) Initial Budgeted Rate Automatic equipment 2 000 000 200,000 860,000 2 10% Semi-automatic equipment 1 000 000 410,000 900,030 2 10% ЙЦУКЕНГШУКЕНГ Ш ЩЗКЕНГШКЕ

For the cash flows shown and in preparation for a PW-based rate of return analysis, determine the incremental cash flow between machines B and Afor (a) year 0, (b) year 3, and (c) year 6.

Please answer the following questions 1. _________________ is the discounted net future cash inflows divided by the initial cash outlay. a.Payback b.NRV c.Profitability Index d.IRR   2. __________________________ serves as a framework for measuring performance. a.NRV b.Payback c.Profitability Index d.Balanced Scorecard   3.  Which of the following is a performance measures of the balanced scorecard: a.internal Business perspective b.all of the answers are correct c.financial Perspective  d.customer perspective

The PW-criterion accounts for the time value of money by converting the cash flows to the period corresponding to the present by using the equations or functional notations Select one: True O False

Determine the rate of return for the following cash flow using trail & error approach with linear interpolation.

Direction: Define, draw the cash flow diagram, and write the general formula of the following: ANNUITY 1. Ordinary Annuity a) Sum/Future of Ordinary Annuity b) Present Worth of Ordinary Annuity 2. Annuity Due 3. Deferred Annuity

Consider the calculation of an external rate of return (ERR). The positive cash flows in the cash flow profile are moved forward to t = n using what value of i in the (F|P,i,n–t) factors? a. 0 b. The unknown value of ERR (i′) c. MARR d. IRR.

Determine the sum of the cash flows in the incremental difference column (i.e., Y-X) for systems X and Y.

2. Interpret each notation or formulas those are shown in the table below and used in economic appraisal process: Factor by which to Multiply "Given Factor Functional Symbol To Find: Given: Factor Name For single cash flows: P (1+N Single payment compound (F/P.%, N) amount F Single payment present (P/F,%, N) worth For uniform series (annuitiesk A Uniform series compound (F/A, %,N) amount Uniform series present (P/A, 1%, N) worth A Sinking fund (A/F.i%, N) (1+ A Capital recovery (A/P,i%, N) (14-1 3. If you are planning a trip to other place after 3 years. And, if you intend to deposit savings of ETB 1,000 now and expects to deposit another ETB 500 at the End of next year. If the bank pays 5% interest per year compounded annually, how much money can you expect to be available to you at the time of your departure? 4. Acompany has to replace a present facility after 15 years at an outlay of ETB. 5,00,000. It plans to deposit an equal amount at the end of every year for the next 15 years at…

There are four variables in the process of adjusting single cash flow amounts for the time value of money:present value (PV), future value (FV), i and n. If you know any three of these, the fourth can be computedeasily