### Calculation for net present value

Assignment Help Operation Management
##### Reference no: EM13107799

Expando, Inc., is considering the possibility of building an additional factory that would produce a new addition to their product line. The company is currently considering two options. The first is a small facility that it could build at a cost of \$8 million. If demand for new products is low, the company expects to receive \$10 million in discounted revenues (present value of future revenues) with the small facility. On the other hand, if demand is high, it expects \$11 million in discounted revenues using the small facility. The second option is to build a large factory at a cost of \$9 million. Were demand to be low, the company would expect \$11 million in discounted revenues with the large plant. If demand is high, the company estimates that the discounted revenues would be \$15 million. In either case, the probability of demand being high is .80, and the probability of it being low is .20. Not constructing a new factory would result in no additional revenue being generated because the current factories cannot produce these new products.

Calculate the NPV for the following: (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers in millions rounded to 1 decimal place.)

 Plans NPV Small facility \$ million Do nothing million Large facility million

### Previous Q& A

#### Write a sentence describing the outcome of hypothesis test

There is some evidence that REM sleep, associated with dreaming, may also play a role in learning and memory processing. For example, Smith and Lapp (9990) found increased REM activity for college students during exam periods.

#### Problems on lean manufacturing

Considering the huge liability associated with workers getting injured on the job, evaluate if implementing of 58 in the work place can help with reducing the risk of these liabilities for an organization, by increasing safety?

#### How each is related to social dilemma within a culture

three social dilemmas are presented. tragedy of the commons or the commons dilemma, resource kilemma, and prisoner's dilemma. choose two of the three concepts.

#### Chi square test for goodness of fit-plagiarism

A recent research report shows that the percentage of college students who have been reported for plagiarizing has reached 30% each in the colleges of Education, Arts and Sciences, and Business, but only 10% in the School of Law.

#### Describe value creation frontier

What is the value creation frontier? How does each of the four generic business models allow a company to reach this frontier?

#### Explain the concept of groupthink

explain the concept of groupthink does not necessarily have a positive connotation. describe what group think refers to, and discuss the conditions that must be present in order for this process to occur.

#### Finding best decision on expected monetary value criterion

The product design group of Flores Electric Supplies, Inc., has determined that it needs to design a new series of switches. It must decide on one of three design strategies.

#### How does both sin and mental dysfunction contribute

How does both sin and mental dysfunction (i.e. cognitive distortion or flawed thinking) contribute to abnormal behavior?

#### What personality traits do leaders todd mcfarlane possess

What personality traits do leaders like Todd McFarlane possess that distinguish them from other individuals?

#### Discuss the legalese of bribery and bartering

Discuss the legalese of bribery and bartering? Compare and contrast business ethics of two foreign countries.

### Similar Q& A

#### Discuss the key process input variables

An important part of a projext is to identify the key process input variables (KPIV) and key process output variables (KPOV). Suppose that you are in charge of a hospital emergency room.

#### Explain why or explain why not

If you want your audience to agree to a specific course of action, should you exclude any references to alternatives that you don't want audience to consider. Explain why or explain why not.

#### What costs are incurred in a layoff that are difficult

If business is expected to improve in one year, are layoffs financially justified? What costs are incurred in a layoff that are difficult to estimate in monetary terms?

#### Decided to cease farming operations and liquidate

Barnes, the owner and operator of Blackacre, decided to cease farming operations and liquidate his holdings. Barnes sold fifty head of yearling Merino sheep to Billing and then sold Blackacre to Clifton

#### The firm terminates steven so that they can put

The firm terminates Steven so that they can put the old secretary back in her job. Steven asks you what you think he should do. What do you say?

#### Illustrate what is their productivity

John makes wooden boxes in which to ship motorcycles. John also his three employees invest a total of 40 hours per day making the 120 boxes. Illustrate what is their productivity.

#### Tyranny of technology in modern medicine

what is does this referrer to? How does this tyranny impact health care management, leadership, and planning

#### Which had greatest utilization rate

During a three day period, 109 healthy babies were born. 60 babies were born in separate labour also delivery rooms, 45 were born in combined labour also delivery rooms, also only 4 babies required a labour room also complicated delivery room. Whi..

#### Calculate the dividend yield and the capital-gain yield

calculate the dividend yield, the capital-gain yield, and the total return to the stock. Express your calculations in percentage terms.

#### Osha compliance has generated some controversy

OSHA compliance has generated some controversy in some business circles. Some in the business world feel it has become overly complex and burdensome

#### Explain how the design of the distribution network affects

explain how the design of the distribution network affects the cost of the four supply chain drivers

#### Illustrate what is our personal responsibility in making

Despite great strides in our country, are re still issues that divide us along racial or cultural lines. If so, illustrate what can organizations do to change this. Illustrate what is our personal responsibility in making positive changes and redu..

#### Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!