❖ Problem 1 Using Microsoft Excel, create an investment cash-flow diagram that will have a present worth of zero using MARR = 12.75%. The study period needs to be exactly 10 years and each year should have at least one unique cash flow that is different from the cash flows over the other years. Your answer should contain a table showing the cash flows for each year and a graphical representation of the cash flows (cash-flow diagram).

This is a reconsideration of the three plans presented in Example 10.1. To recap, the plans are:Plan 1: Receive $100,000 now.Plan 2: Receive $15,000 per year for 8 years beginning 1 year from now.Plan 3: Receive 45,000 now, another $45,000 four years from now, and afinal $45,000 eight years from now.If i = 6% per year and f = 4% per year, (a) find the best plan based on PW,(b) determine the worth in future dollars of each plan 8 years from now ininflated dollars, and (c) determine the future value of the plans in terms oftoday’s purchasing power.

Pittsburgh Steel Company has a convertible bond outstanding, trading in the marketplace at $930. The par value is $1,000, the coupon rate is 5 percent, and the bond matures in 20 years. The conversion price is $40 and the company's common stock is selling for $32 per share. Interest is paid semiannually. If the interest rate on similar bonds that are not convertible are currently yielding 12 percent, what will be the pure bond value of the Pittsburgh Steel Company bonds? (Use semiannual analysis.) Use Appendix B and Appendix D as an approximate answer, but calculate your final answer using the formula and financial calculator methods. Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. ces Bond value

Problem #4 (3/10): Six mutually exclusive projects A, B, C, D, E, and F, are being considered by XYZ. They have been ordered by first costs so that project A has the lowest first cost, project F the largest. Detailed cash flows for Projects A and B are given below. (MARR is 10%) Project A: Initial Cost of $323,120. annual benefit of $50,000 for 15 years Project B: Initial Cost of $494,310. annual benefit of $70,000 for 15 years (a) Based on the cash flows and the MARR of 10%, what is the IRR for Project A? (b) Based on the cash flows, calculate the IRR for the increment from A to B. (c) The table below apply to all projects (A through F). The data can be interpreted as follows: the IRR on the incremental investment from project C to D is 13%.. Which project should be selected? IRR on Increments of Investment Project A BCDEF IRR on overall Investment ? 11% 11% 13% 19% 15% A ? 9% 11% 16% 10.5% B 11% 15% 16% 14% Compared with Project с 13% 14% 13% 9% 6% E 9.50%

A regional municipality is studying a water supply plan for its​ tri-city and surrounding area to the end of the year 2070. To satisfy the water​ demand, one suggestion is to construct a pipeline from a major lake some distance away. Construction would start at the beginning of 2030 and take five years at a cost of ​$20 million per year. The cost of maintenance and repairs starts after completion of construction and for the first year is ​$3 ​million, increasing by 1 percent per year thereafter. At an interest rate of 7 percent, what is the present worth of this​ project? Assume all cash flows take place at​ year-end. Consider the present to be the end of​ 2025/the beginning of 2026. Assume there is no salvage value at the end of the year 2070.

ANSWER IN COMPLETE SOLUTION.In one stage of its chili canning operation, Ashley Foods, Inc. has decided that any of five devices can be used. The costs of the machines are calculated below, and it is calculated that all machines will have a useful life of 4 years. Determine which computer should be chosen based on a rate of return study if the minimum attractive rate of return is 20 percent per year.

Question 5 The second, Van Y, has a useful life of 10 years and will cost you $33,000 in Year 0. You expect it to earn the same additional $8,000 per year in profit, and have a salvage value of $5,000 at the end of Year 10. Using the coterminated assumptions and a study period of 15 years, what is the Future Worth of Van Y? Assume that you reinvest all cash flows at the MARR after the end of the useful life of the van. Typed numeric answer will be automatically saved.

Suppose Omni Consumer Products's CFO is evaluating a project with the following cash inflows. She does not know the project's initial cost; however, she does know that the project's regular payback period is 2.5 years. Year Cash Flow Year 1 $350,000 Year 2 $400,000 Year 3 $475,000 Year 4 $475,00 If the project's weighted average cost of capital (WACC) is 9%, what is its NPV? $373,562 $336,206 $317,528 $429,596

If mutually exclusive projects with normal cash flows are being analyzed, the net present value (NPV) and internal rate of return (IRR) methods always agree. Projects Y and Z are mutually exclusive projects. Their cash flows and NPV profiles are shown as follows. Year Project Y Project Z 0 -$1,500 -$1,500 1 $200 $900 2 $400 $600 3 $600 $300 4 $1,000 $200 NPV (Dollars) 800 600 Project Y 400 Project Z 200 -200 0246 8 10 12 14 16 18 20 COST OF CAPITAL (Percent) If the weighted average cost of capital (WACC) for each project is 14%, do the NPV and IRR methods agree or conflict? O The methods agree. O The methods conflict.