I want you to make a cash flow diagram on the given problem below. Only the Cash Flow Diagram (CFD), i am not asking you to solve it. 4.A corporation is considering purchasing a machine that will save $210,000 per year before taxes. The cost of operatingthe machine, including maintenance, is $60,000 per year. The machine, costing $120,000, will be needed for four yearsafter which it will have a salvage value of $16,000. If the firm wants a 12% rate of return before taxes, what is the netpresent value of the cash flows generated from this machine? Ans. P= $465,770.69

The measure that depicts the current stream of cash flows or income streams being generated at a…

Answered: I want you to make a cash flow diagram…

I want you to make a cash flow diagram on the given problem below. Only the Cash Flow Diagram (CFD), i am not asking you to solve it.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: What is the cost-effective solution for abatement of toxins by firms All firms should abate until…

A: Since, the cost effective solution for the abatement of toxins by firms means how the firms adjust…

Q: If the firm is in the situation described in Q. 17 (i.e., continuing to operate in the short-run,…

A: 18. Here, it is given that a perfectly competitive firm is operating at a level where it incurs…

Q: In the figure below, panel (a) depicts the linear marginal cost of a firm in a competitive market,…

A: Perfect competition is an ideal kind of market structure where all makers and customers have full…

Q: Very large aggregate supply changes are always responsible for very high inflation rates. Select…

A: Aggregate supply: It refers to an increase in the total output of goods and services. It shows the…

Q: When the covid-19 shock started in early 2020, supermarkets quickly ran out of toilet paper as panic…

A: Introduction Even though the country is progressively reopening in the midst of the coronavirus…

Q: In considering the merits of lengthening the duration of unemployment benefits one should consider?…

A: Unemployment benefit programmes exist in every industrialized economy to safeguard employees from…

Q: Suppose Antonio has utility function over wealth given by Va (y) = √ and suppose Dillon has the…

A: The given function is:

Q: Max Pentridge is thinking of starting a pinball palace near a large Melbourne university. His…

A: The measure that depicts the satisfaction that is being gained by an individual from the consumption…

Q: [True/False] Let a, b and c represent constants, and X, Y and Z represent random variables. If…

A: A random variable is a mathematical portrayal of the result of a measurable examination. A random…

Q: Give an explanation to the answer and ensure all the steps are shown.

A: Given:

Q: Consider the three small mutually exclusive investment alternatives in the table below. The feasible…

A: A B C Investment Cost 2000 8000 20000 Annual Revenue 600 2200 3600 n 5 5 10

Q: Elaborate what is catering function for.

A: Function catering is the provision of a particular function for a certain set of people at a defined…

Q: Which of the following would be a reason why incumbents may have an absolute cost advantage over…

A: Adam Smith propounded the hypothesis of outright expense advantage as the premise of unfamiliar…

Q: 6. Compare & contrast EITC, the minimum wage, and UBI. Which do you think is most effective in…

A: Compare EITC is known as Earned Income Tax Credit in the United States is a refundable tax credit…

Q: which of the following factors does not indicate market liquidity? a. number of shareholders b.…

A: When talking about market liquidity, it can be said that it is the ability of an asset to be…

Q: 2. Assume that the (daily) demand (measured in hours of work) of unskilled labor in a particular…

A: Step 1 A minimum pay permitted by law is the most reduced compensation that businesses can…

Q: In not less than five sentences, explain ONE risk that a banking company is exposed to and how do…

A: Answer -

Q: Are products with patents a monopoly? Would it be expensive for another company to replicate?

A: Monopoly is a market condition where there is a single seller. It sells a unique commodity in the…

Q: Could you repeat the math for the change in GDP equation? The spacing of the numbers is a bit…

A: Here, GDP deflator in base year is given as 125 and GDP deflator after two years is given as 150.…

Q: at is the gain or loss on purchasing power for 2021? (if LOSS, put a negative (-) sign before the…

Q: What is a market? What are the requirements for a market?

A: Markets: - markets mean a platform where different parties connect with each other and exchange…

Q: (For this question only, assume) Domestic output Y and domestic interest rate i are fixed. Define…

A: When talking about economic sanction, it is the government policy that is implemented against the…

Q: what is fisher effect theory and explian is it holds are not in short trem capital markets

A: Fisher's Effect:- The Fisher Effect is a concept proposed by economics expert Irving Fisher to…

Q: 3.An industrial firm is considering purchasing several programmable controllers and automating the…

A: As we can see that there is an initial investment of 120000 and the labor cost to install is…

Q: why is the fixed cost 10?

A: Fixed cost doesn't change with the change in the number of output.

Q: ou have worked in the industry for a decade, and you are now fed up with the boring work environment…

A: Here, we aim to become entrepreneurs, which refers to generating fresh ideas and turning them into a…

Q: Question 2 Which of the following firms is the closest to being a perfectly competitive firm? Group…

A: Answer is given below

Q: Home country has 1200 units of labor available while Foreign country has 800 units of labor. In Home…

A: Each country has different level of labor unit requirements for both the goods apples and bananas.

Q: market for paperback detective novels is perfectly competitive. Suppose we have identical book…

A: In economic matters, explicitly broad balance hypothesis, an ideal market, otherwise called an…

Q: Consider the economy of MadibazVille MadibazVille does not trade with the rest of the world. [Note:…

A: In a closed economy:- GDP=Y=C+I+G here Y=3K0.5L0.5 C=150+0.75Y-T I=210-5r G=500 K=1600 L=81 and…

Q: If the CPI in 2015 was 114.7 and the CPI in 2016 was 124.5, then the rate of inflation between 2015…

A: The CPI is used to measure the inflation rate in economy.

Q: and has a short run production function Q(L)=20L-L2. Its wage rate is w=40. Suppose the firm sells…

A: *Answer:

Q: What is the difference between the Keynesian and rational expectation theories concerning the…

A: Fiscal policy and monetary coverage are called financial stabilization rules that regularly cross…

Q: What is meant by form utility?

A: Utility is an economic term which refers to satisfaction.

Q: Question 9 Rational consumer behaviour is where a person consumes the amount of a good that…

A: "Consumers consume commodities and services and in return they attain utility or satisfaction from…

Q: Which of the following is not an implication of the EMH? a. to do superior industry or company…

A: The efficient market hypothesis (EMH) refers to an economic and investing theory that seeks to…

Q: he market for paperback detective novels is perfectly competitive. We have two types of consumers in…

A: Regular reader's demand curve: P = 79 - 2Q Put Q = 0, and solve for P => P = 79 - 2(0) => P =…

Q: 1. Consider a market with four identical firms, each of which makes an identical product. The demand…

Q: Draw a graph of Pepsi company that related to the product differentiation.

A: Monopolistic competition: It has the features of both a monopoly and a perfectly competitive market.…

Q: Question Assume a competitive market is in equilibrium. There is an increase in demand, but no…

A: The curve that depicts various quantities of goods and services being demanded by individuals at…

Q: How to measure PRODUCT DIFFERENTIATION in FOOD AND BEVERAGES INDUSTRY?

A: Answer-

Q: Question 13 If a firm operating in a competitive industry shuts down in the short run, it can avoid…

A: The structure of a market where there are numerous firms competing with each other for selling goods…

Q: If U.S. government statistics counted education spending as part of the investment, which of the…

A: Purchaser spending or consumer spending is the all out cash spent on definite labor and products by…

Q: Poornima is a skilled toy maker who is able to produce both boats and drums. She has 8 hours a day…

A: The cost of the next best alternative foregone is reffered to be as opportunity cost

Q: When the covid-19 shock started in early 2020, supermarkets quickly ran out of toilet paper as panic…

A: The demand graph merely denotes that the situation or the relationship between the quantity of the…

Q: Consider a firm who sells output at p=10 and has a short run production function Q(L)=20L-L2. Its…

A: In this situation we have:- Q(L)=20L-L2 MPL=∂QL∂L=20-2L and VMPL=P×MPL=wor 1020-2L=wor 200-20L=w…

Q: Q1. Consider the adverse selection model, where the ability of each worker, 0, can be 1, 2 or 5.…

A: Ability of each worker = 1, 2,or 5 Probability associated to each = (1/3,1/6,1/2) Reservation Value…

Q: Consider the three small mutually exclusive investment alternatives in the table below. The feasible…

Q: Consider a competitive market in which the MPB = 180 – 2q and the MSC = q. In this market, however,…

A: "A positive consumption externality occurs when an person's consumption raises the well-being of…

Q: 4. For MARR of 6% and each alternative having a life of 20 years with no salvage value and cost…

A: We will find the present worth of all three alternatives and then the alternative with the greatest…

Question

I want you to make a cash flow diagram on the given problem below. Only the Cash Flow Diagram (CFD), i am not asking you to solve it.

4.A corporation is considering purchasing a machine that will save $210,000 per year before taxes. The cost of operating
the machine, including maintenance, is $60,000 per year. The machine, costing $120,000, will be needed for four years
after which it will have a salvage value of $16,000. If the firm wants a 12% rate of return before taxes, what is the net
present value of the cash flows generated from this machine? Ans. P= $465,770.69

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Economics QUESTION 4 An asset with initial cost base of 6 million was bought 5 years ago. At the end of the current year (fifth year) the asset is sold by 1.1 million. The asset belongs to the 7 years MACRS property class. Knowing that the gains(loss) tax rate is 40%, what is the net proceeds resulted from selling this asset? $897,400 2,044,012 978,700 O 2,371,600
5 Mr. H Salt purchased an 1/8 interest in a producing oil well for $45,000. Recoverable oil reserves for the well were estimated at that time at 15,000 barrels, 1/8 of which represented Mr. Salt's share of the reserves. During the subsequent year, Mr. Salt received $12000 as his 1/8 share of the gross income from the sale of 1000 barrels of oil. From this amount, he had to pay $3000 as his share of the expense of producing the oil. Compute Mr. Salt's depletion allowance for the year.
What impact does the market for intangible property such as stocks and bonds have on the market for real estate? Why would a real estate investor pay attention to what is happening in these markets? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Consider a project that will bring in upfront cash inflows for the first two yearsbut require paying some money to close the project in the third year. A0 A1 A2 $6,500 $4500 $13000 This is a simple borrowing project. Determine the borrowing rate of return.
NPV Calculate the net present value (NPV) for the following 12-year projects. on the acceptability of each. Assume that the firm has a cost of capital of 7%. a. Initial investment is $1,000,000; cash inflows are $ 160,000 per Year b. Initial investment is $2,500,000; cash inflows are $320,000 per Year Using Excel to answer. Show all Formulas
A company invests $6,250 at the beginning ofa seven-year project. At the end of every year forthe first five years, the project generates $1,550. Atthe end of the sixth year, the project generates nomoney. At the end of the seventh year, the project isterminated. How much must the project generate atthe end of the seventh year to realize 14% return onthe initial investment?
Please use excel to solve and show equations. A project is being evaluated. The project will create the following cash flows: Year Cash Flow 0 $ 1,290,000 1 465,000 2 530,000 3 425,000 4 380,000 In an attempt to improve its economy, the Erewhonian government has declared that all cash flows created by a foreign company are blocked and must be reinvested with the government for one year. The reinvestment rate for these funds is 3 percent. If Anderson uses a required return of 12 percent on this project, what are the NPV and IRR of the project? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. Enter your IRR as a percent.) Whats is the NPV and IRR of the project of the project? Please use excel to solve and show equations.
Most businesses replace their computers every two to three years. Assume that a computer costs $2,000 and that it fully depreciates in 3 years, at which point it has no resale value and is thrown away. Suppose the computer did not fully depreciate but still had a $250 value at the time it was replaced. What is the minimum annual cash flow that a computer must generate to be worth the purchase? The minimum annual cash flow must be at least $
Lamar Company is studying a project that would have an eight-vear life and require a S1,600,000 invest- ment in equipment. At the end of eight vears, the project would terminate and the equipment would have no salvage value. The project would provide net income ench year as follows: Sales... Less: Variable expenses. $3,000,000 1.800,000 .... Contribution margin. Less: Fixed expenses: Advertising, salaries, and other fixed out-of-pocket costs.... . 1,200,000 $700,000 Amortization 200,000 Total fixed expenses. 900,000 Net income... $ 300,000 The company's discount rate is 18%. Required: 1. Compute the net annual cash inflow from the project. 2. Compute the project's net present value. Is the project acceptable? 3. Compute the project's payback period. If the company requires a maximum payback of the the project acceptable? 4. Compute the project's simple rate of return.
Y T Yd C 500 175 325 340 600 200 400 400 700 225 475 460 800 250 550 520 900 275 625 580 Refer to the information above to answer this question. What is the value of the MTR? 0.25 B 0.40 © 0.60 D 0.15 E 0.20
Please view the following video before answering this question. Excel Video Lesson: PV Financial Function Click here to access the TVM Factor Table Calculator Bailey, Inc., is considering buying a new gang punch that would allow them to produce circuit boards more efficiently. The punch has a first cost of $90,000 and a useful life of 15 years. At the end of its useful life, the punch has no salvage value. Annual labor costs would increase $4,500 using the gang punch, but annual raw material costs would decrease $10,000. MARR is 5.25 %/year. Part a * Your answer is incorrect. What is the present worth of this investment? $ -29,598.08 Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±5.
A mechanical device will cost $20,000 when purchased. Maintenance will cost $1,000 per year. The device will generate revenues of $5,000 per year for 5 years. The salvage value is $7000. What is the total cash flow in Year 3? O a. $4,000 O b. $1,000 C. $6,000 d. $5,000 Type here to search