One of two mutually exclusive alternatives must be selected. Alternative A costs $30,000 now for an annual benefit of $8450. Alternative B costs $50,000 now for an annual benefit of $14,000. Using a 15% nominal interest rate, compounded continuously, which do you recommend? Solve by annual cash flow analysis with 5 year lives.

Using a present value table (Table 6-4 and Table 6-5), calculate the present value for the following: Note: Use the appropriate value(s) from the tables provided and final answers to the nearest whole dollar. Required: a. A car down payment of $10,000 that will be required in two years, assuming an interest rate of 10%. b. A lottery prize of $22.0 million to be paid at the rate of $1,100,000 per year for 20 years, assuming an interest rate of 10%. c. The same annual amount as in part b, but assuming an interest rate of 14%. d. A financing lease obligation that calls for the payment of $34,000 per year for 10 years, assuming a discount rate of 8%. a. Present value b. Present value c. Present value d. Present value

Your required rate of return is 10 percent. If you invest $3,000 today you will receive the following cash flows from year 1 to 4: 2000, 500, 1000, 2000. Calculate the Discounted Payback Period of the project. 3.7 years 3.9 years 3.1 years 3.5 years 3.3 3 years

You can use machine A with an initial investment of $1,000 and a maintenance cost of $7,980 annually for the next five years. Alternatively, you can purchase machine B for $12,000 initial cost today, plus $5,000 annual maintenance with the same 5 years life. At a cost of capital of 15%, you should: Show your Work    A. Use machine A and save $600 in equivalent annual annuity.  B. Use machine A and save $302 in equivalent annual annuity.  C. Use the machine B and save $596 in equivalent annual annuity.  D. Buy the machine C and save $600 in equivalent annual annuity.  E. Buy machine B and save $596 in equivalent annual annuity.