Suppose you have the following two investment projects with operating costs and revenues over 5 years: Year Project A Project B Revenues Operating Costs Revenues Operating Costs (OMR) (OMR) (OMR) (OMR) 2025 12000 5000 50000 33000 2026 12500 5300 52000 34500 2027 13500 5700 53800 35000 2028 13800 6000 54000 36000 2029 14200 6200 45500 36500 2030 15000 6500 55000 37000 If the investment cost is OMR25000 for project A and OMR155000 for project B, determine which project is the best choice using ARR and IRR methods (Interest rate is 10%).

Suppose you have the following two investment projects with operating costs and revenues over 5 years: Year Project A Project B Revenues Operating Costs Revenues Operating Costs (OMR) (OMR) (OMR) (OMR) 2025 12000 5000 50000 33000 2026 12500 5300 52000 34500 2027 13500 5700 53800 35000 2028 13800 6000 54000 36000 2029 14200 6200 45500 36500 2030 15000 6500 55000 37000 If the investment cost is OMR25000 for project A and OMR155000 for project B, determine which project is the best choice using ARR and IRR methods (Interest rate is 10%).

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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6ix cas Q1:-ADIaduces faces a irsiable costRS S per Rs, 50 and a unit output when he produces leen f output than 200 units of function. •Assuming that total cost 15 limeandetemine the eajuation the tobal. cost function n level 6 t of ' What is the break-ever outpul Rs, 10 goaphs Detenmine the producens net f phice. of out put is umit, Also doaw che nelevak the price of per. output in 12 umnits onnd the Loutput is , RS10 amd R15 espectively Rs.5. and R,15
Total Fixed cost is 60000 OMR Total Variable cost is 100000 OMR Calculate TotalCost Select one: of O a. 125000 OMR O b. 160000 OMR stion Ос. 165000 OMR O d. 150000 OMR
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K If x= 45, v = $110, and f= $2,400, then total costs equal OA. $2,510. OB. $7,350. OC. $110. OD. $4,950.
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data save velevant to Us product A and B Pvooluct P Pe unit RS Selling Price Direct mateal 45.00 birect wages Depaitment:1 0000 00.00 3. vaniable overheat Fixed overhead is budgekd at RS 275,000 per anum data each depaitment ave: pe. for present envivonment, it's not possible Show maihematically objetive ftn 4 cons trants 6) compute duad of The problems Uking graphical meihod q solve lhe रिज्o u+ primal s solve both dual of The comespondoing prim al problem using hit & fral method s compare your answe
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On the cost-volume-profit graph, the area between the total cost line and the sales line after the break-even point represents: O a. The contribution margin per unit O b. The profit area O c. The variable cost amount O d. The fixed cost amount O e. The loss area US PAGE NEXT PAGE nere to search O W 19:09 A O D a d) ENG 07-04-2021 hp prt sc delete home end & 9 + backspace num lock R T P home D F G H K enter レ pause ↑ shift 11 end alt ctrl
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Calculate the profitability of the following proposal using Average rate return (ARR) methodProposal IAutomatic machine Cost OMR 320000Estimated life4.5 yearsEstimated sales P.A 220000Cost : Material OMR 60000 Labour OMR 22000 Variable overheads OMR14000 a.16.53% b.3.19% c.4.62% d.All the options are wrong

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