Give me the correct answer please?Bid Amount You are working on a bid to build two apartments building per year for the next three years. This project requires the purchase of $250,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the project’s life. The equipment can be sold at the end of the project for $50,000. The fixed costs will be $100,000 per year and the variable costs will be $50,000 per. Your required rate of return is 15 percent and your tax rate is 21 percent. What is the minimal amount you should bid per building ? (PVIFA for 15%, 3 years =2.2832,PV factor for 15% 3 years is 0.6575)
Give me the correct answer please?Bid Amount You are working on a bid to build two apartments building per year for the next three years. This project requires the purchase of $250,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the project’s life. The equipment can be sold at the end of the project for $50,000. The fixed costs will be $100,000 per year and the variable costs will be $50,000 per. Your required rate of return is 15 percent and your tax rate is 21 percent. What is the minimal amount you should bid per building ? (PVIFA for 15%, 3 years =2.2832,PV factor for 15% 3 years is 0.6575)
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 2PB: Markoff Products is considering two competing projects, but only one will be selected. Project A...
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Give me the correct answer please?Bid Amount
You are working on a bid to build two apartments building per year for the next three years. This project requires the purchase of $250,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the project’s life. The equipment can be sold at the end of the project for $50,000. The fixed costs will be $100,000 per year and the variable costs will be $50,000 per. Your required rate of return is 15 percent and your tax rate is 21 percent. What is the minimal amount you should bid per building ? (PVIFA for 15%, 3 years =2.2832,PV factor for 15% 3 years is 0.6575)
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