Elya's construction company is charged 150 pesos per ton for hauling its raw materials by ABC trucking company. Forty tons per day are hauled for 300 days a year. They desired to install a railway system to reduce the cost of trucking of the raw materials to 6.6 pesos per ton. Maintenance costs of this are 12000 per month. Tax is 1%. The average rate of earning is 20% if the company has the cash necessary for the installation, would you recommend the change? if the company has to float 5,000,000 pesos worth of non-callable bonds at 15% that will mature in 10 years to have the capital for the project, would you recommend that change?

The average car depreciates in value about 15% per year. Suppose you buy a silver Cherolet Cruze LTZ worth $26,000 (and made no down payment). What is the value of the car if you bought it 4 years ago?

Fink Co. is interested in purchasing a new business vehicle. The vehicle costs $50,000 and will generate constant-dollar delivery revenue of $20,000 (year O dollars) for each of the next 6 years. At the end of the 6 years, the vehicle will have a salvage value of $5,000. The tax rate is 21%, and annual inflation is 3%. Assuming that the vehicle is depreciated using MACRS (5-year property class) and that Fink Co. uses an after-tax real interest MARR of 8%, compute the PW, and determine whether Fink Co. should purchase the new business vehicle. Click here to access the TVM Factor Table calculator. Click here to access the MACRS-GDS Property Classes. Click here to access the MACRS-GDS percentages page. Click here to access the MACRS-GDS percentages for 27.5-year residential rental property. LA

The Sherman Antitrust Law was originally designed to prevent the formation of large corporations or cartels that could dominate the market. (T/F)

A university is trying to determine how much it should charge for tickets to basketball games to help offset the expenses of the new arena. The cost to build the arena including labor, materials. e tc. was $92 million. Each year the maintenance cost is expected to increase by 5% as the building gets older. 1l1e maintenance cost for the first year is $150.000. Utilities arc expected to average about $200.000 per year and labor costs $300,000. The average attendance at basketball games over the year is expected to be J00.000 people (or 100.000 tickets sold to events). Assuming the arena has no other source of income besides regular ticket sales (not including student tickets) for basketball games, what should the university charge so that it can recover at least a 6% cost of borrowing on its investment? ll1c university expects the arena to be used for 40 years and 10 have no appreciable salvage value.

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You as a businessperson have one million dollars to invest. One option is to invest your money. in a saving account that gives you 8% annual interest rate. But you decide to open a book store instead. You need to rent a place for $7900 per month and hire two workers and pay them each $6000 monthly. The other expenses such as purchases and overhead are $6500 per month. Your store generates $395,000 sales per year. How much is your economic profit? Which business do you choose? explain

You are evaluating two different silicon wafer milling machines. The Techron I costs $270,000, has a 3-year life, and has pretax operating costs of $73,000 per year. The Techron II costs $470,000, has a 5-year life, and has pretax operating costs of $46,000 per year. For both milling machines, use straight-line depreciation to zero over the project's life and assume a salvage value of $50,000. If your tax rate is 24 percent and your discount rate is 10 percent, compute the EAC for both machines. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Techron I Techron II

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Calculate the value of output if value added is $2500 million and the intermediate con- sumption is $560 million