Economics of a new manufacturing process
Not what you're looking for?
2. A machine is under consideration for a new manufacturing process. The interest rate is 10% computed semiannually. Compute the future worth of this alternative:
First cost = $70,000
Semiannual cost = $6,000
Semiannual income = $18,000
Salvage value = $9,000
Life in years = 5
4. You deposit $5,000 in a savings certificate. The bank pays compound interest at an annual rate of 12%, compounded quarterly. At the end of 4 years, how much money have you earned in the savings certificate?
7. Consider the following sets of investments projects in Table 1. All projects have a 5 year investment life, with and interest rate of 10%.
Table 1 Project Cash Flow ($)
N A B
0 -$17,000 -$18,000
1 4100 3300
2 4200 3500
3 4300 3700
4 4400 3900
5 4500 4100
5 (Salvage Value) 5000 5500
Compute the present worth of project A, in Table 1.
8. How much do you have to pay for a bond rate that pays 6% dividend compounded semiannually, with a face value of $5,000 that is going to be paid (maturity) in 5 years. The buyer wants to have an interest rate profit of 8% compounded semiannually.
Purchase this Solution
Education
- MPhil, Madurai Kamaraj University
- MCom, Annamalai University
- IATA, International Air Transport Association
Recent Feedback
- "Great explanations on how the answers were obtained."
- "Love the way she explains everything step by step."
- "Solutions were thoroughly explained."
- "Excellent explanations of how problems are solved"
- "Thanks"
Purchase this Solution
Free BrainMass Quizzes
Elementary Microeconomics
This quiz reviews the basic concept of supply and demand analysis.
Economic Issues and Concepts
This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.
Economics, Basic Concepts, Demand-Supply-Equilibrium
The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.
Basics of Economics
Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.
Pricing Strategies
Discussion about various pricing techniques of profit-seeking firms.