Consider a wind energy project that produces 399 GWh/yr and is able to sell this at a cost of $0.1/kWh. The project will also receive income in this year from the PTC, at a value of $0.023/kWh. The annual operating expenses come out to be $0.014/kWh ..
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Katy won the Texas lottery. She can take a single lump-sum payout of $12.5 million dollars or receive $825,000 per year for the next 25 years. What rate of return would Katy need to break even if she took the lump-sum amount instead of the annuity?
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You have $10,000 to invest in a stock portfolio. Your choices are Stock X with an expected return of 14 percent and Stock Y with an expected return of 11 percent. Assume your goal is to create a portfolio with an expected return of 12.4 percent. How ..
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If the bank's quoted interest rate is 6% per annum and coffee prices increased at a 3% annual rate of inflation, what would an endless, inheritable free subscription to one Starbucks coffee per day be worth today
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Acme Conglomerate Corporation operated three divisions. One division involves significant research and development, and thus has a high-risk cost of capital of 15%. The second division operates in business segments related to Acme's core business, an..
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Cervetti Corporation has two major business segments-East and West. In July, the East business segment had sales revenues of $230,000, variable expenses of $130,000, and traceable fixed expenses of $30,000. The contribution margin of the West busines..
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Valuation of a firm's financial assets is said to be based on what is expected in the future, in terms of the future performance of the firm, the industry, and the economy. What types of value would you consider when assigning value to a firm's stock..
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Compare and contrast the main policies of the US Federal Reserve and the European Central Bank over the last 10 years. Based on these policies, identify and contrast the main priorities of these institutions. How do these policies affect exchange rat..
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Marko, Inc. is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $4,800, $9,800, and $16,000 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has determ..
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Craig purchased 150 shares of Box, Inc. (BOX) when it went public for $14 per share. He wants to sell his shares today, 50-days later, for $18.20 and it paid a $2.13 dividend. What is his annualized return?
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Smith's Shoe Shop had $4,000,000 in operating income last year, after-tax cost of capital of 7%, and a tax rate of 35%. The company has $14,000,000 in stockholder's equity, $17,000,000 in long-term bonds, and $1,500,000 in preferred stock.
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An investment in a real estate venture will provide after tax cash flows for the next 5 years as follows: year 1, $ 7,500; year 2 $10,000; year 3 $11,000; year 4, $13,500, and year 5, $415,000. An investor would like to earn an annual return of 13%. ..
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