☐☐☐☐☐),what is its annual profit? (☐☐☐☐☐☐= ?) Four alternatives (Alternatives A, B, C, and D) described below are being evaluated.Incremental Rate of Return, %,When Compared withAlternativeBAlternativeABCDInitialInvestment, $- 30,000- 71,000- 95,000- 110,000Overall Rateof Return. %16.91517.510A18.719.216.715C101)A) If the alternatives are independent, which one(s) should be selected ata MARR of 15% per year? There is no budget limit.B) If the alternatives are mutually exclusive (ME), which one should beselected ata MARR of 17% per year? {Hint: Consider Do Nothing (DN)}2)B/C Analysis - Single Project:Calculate the conventional B/C ratio for a county government projectthat is predicted tohave the following cash flows:• Costs of $1,900,000 per year• Benefits of $2,100, 000 per yearDisbenefits of $250,000 per year.Should the county government invest in that project?Please explain your answer. (meaning: explain why you think the governmentshould or should not invest in the project).3) Breakeven Quantity – Single Project:The fixed costs at Company A are $1 million annually. The main producthas a revenue of $9.90 per unit and a variable cost of $4.50 per unit.Determine the following:a. Breakeven quantity per year (= ?)b. If the company can sale 480, 000 units of the product ( = 480,000

Name: ☐☐☐☐☐),what is its annual profit? (☐☐☐☐☐☐= ?) Four alternatives (Alte
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Description: ☐☐☐☐☐),what is its annual profit? (☐☐☐☐☐☐= ?) Four alternatives (Alternatives A, B, C, and D) described below are being evaluated.Incremental Rate of Return, %,When Compared withAlternativeBAlternativeABCDInitialInvestment, $- 30,000- 71,000- 95,000

A capital project or alternative is selected if it adds value to the company. It adds value to the…

Business

Finance

Four alternatives (Alternatives A, B, C, and D) described below are being evaluated. Incremental Rate of Return, %, When Compared with Alternative B Alternative A B C D Initial Investment, S - 30,000 -71,000 -95,000 -110,000 Overall Rate of Return, % 16.9 15 17.5 10 A 44 18.7 19.2 16.7 15 C 10 1) A) If the alternatives are independent, which one(s) should be selected at a MARR of 15% per year? There is no budget limit.

Four alternatives (Alternatives A, B, C, and D) described below are being evaluated. Incremental Rate of Return, %, When Compared with Alternative B Alternative A B C D Initial Investment, S - 30,000 -71,000 -95,000 -110,000 Overall Rate of Return, % 16.9 15 17.5 10 A 44 18.7 19.2 16.7 15 C 10 1) A) If the alternatives are independent, which one(s) should be selected at a MARR of 15% per year? There is no budget limit.

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 6P

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Four mutually exclusive alternotives are compared and their internal rate of return (IRR) values are as follows: A = 11.2%; B= 12.3%; C- 13.1%; and D= 128%. Which alternative(s) must be selected it MARR = 11%P O a All aiternatives b. Alternotives Cand D C. None of the alternatives d. Alternative C O e. Insutficient information to decide
Given the financial data for four mutually exclusive alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =10%.
Possible outcomes for three Investment alternatives and their probabilities of occurrence are given next. \table, Alternative 1, Alternative 2, Alternative 3], [Failure, Outcomes, Probability Outcomes, Probability, Outcomes, Probability], [Acceptable 80, 0.20, 80, 0.40,90, 0.30], [Successful, 70, 0.20, 170,0.40, 290, 0.50]] Using the coefficient of variation, rank the three alternatives in terms of risk from lowest to highest. Note: Do not round Intermeciate calculations. Round your answers to 3. decimal places, table[], \table[[Coefficient of], [Variation]], Rank], [Alternative 1... [Alternative 2,,], [Alternative 3..]]
Two projects, A and B, are analyzed using ranking present worth analysis with MARR at i%. It is found that PW(A) > PW(B). If MARR is changed to (i + 1)%, what will be the relationship between PW(A) and PW(B)? a. PW(A) > PW(B) b. PW(A) = PW(B) c. PW(A) < PW(B) d. Cannot be determined without the cash flow profiles.
Use the following information to answer the question. Based on above data, determine the expected return? Select one: a. 12.06% b. 19% c. 17.35% d. 16.72%
You are given the following data about Asset A and Asset B. Asset A Asset B Expected returns 8.6% 7.9% Standard Deviation 3.8% 4.6% Assuming that an investor is to choose between Asset A or Asset B, explain which asset a rational investor will choose. c) With the use of a diagram, explain why an investor will always choose a point on the SML line.
If alternatives’ useful lives are different, B/C ratio analysis should preferably be based on: Select one: a. present worth b. annual worth c. future worth d. ROR
QUESTION 5 Invest in any or all of the four projects whose relevant cash flows are given in the following table. The firm has RM7,000,000 budgeted to fund these projects, all of which are known to be acceptable. Initial investment for each project is the same for all projects which is RM1,600,000. The rate of return for all projects is equivalent to 8%. Operating cash outflow Project X Year 1 Project Y Cash Outflow RM1,600,000 (for each project) Operating Cash Inflows RM 440,000 RM 140,000 1 340,000 220,000 (110,000) ( 95,000 ) 105,000 220,000 388,000 180,000 250,000 260,000 370,000 460,000 3. 4. 5. 6. 7. 8. 9. Use this table for PROJECT X and Y Period PVIF 8% 1 0.9259 2 0.8573 3 0.7938 4 0.7350 0.6806 6 0.6302 7 0.5835 8 0.5403 9 0.5002 10 0.4632 8
An investor is consider four different opportunities, A, B, C, or D. The payoff for each opportunity will depend on the economic conditions, represented in the payoff table below. Economic Condition Investment Poor Average Good Excellent (S1) (S2) (S3) (S4) A 50 75 20 30 B 80 15 40 50 C -100 300 -50 10 D 25 25 25 25 What decision would be made under minimax regret?
a. Using the data in the table below alculate the following performance measures.i. Sharpe ratioii. Treynor measureiii. Jensen’s alphaiv. M-squared measurev. T-squared measure, andvi. Appraisal ratio (information ratio) Fund Average return Standard Deviation Beta coefficient Unsystematic Risk A 0.240 0.220 0.800 0.017 B 0.200 0.170 0.900 0.450 C 0.290 0.380 1.200 0.074 D 0.260 0.290 1.100 0.026 E 0.180 0.400 0.900 0.121 F 0.320 0.460 1.100 0.153 G 0.250 0.190 0.700 0.120 Market 0.220 0.180 1.000 0.000 Risk free return 0.050 0.000 b. Out of the performance measures you calculated in part a., which one would you use undereach of the following circumstances:i. You want to select one of the funds as your risky portfolio.ii. You want to select one of the funds to be mixed with the rest of your portfolio,currently composed solely of holdings in the market-index fund.iii. You want to select one of the funds to form an actively managed stock portfolio
If the internal rate of return (IRR) of a well-behaved investment alternative is equal to MARR, which of the following statements about the other measures of worth for this alternative must be true? i. PW = 0 ii. AW = 0. Solve, a. I onlyb. II only c. Neither I nor II d. Both I and II.
The expected value, standard deviation of returns, and coefficient o below.) \table[[Asset A],[Possible Outcomes,Probability,Returns (%)