Reference no: EM131793964
Bill Williams has the opportunity to invest in Project A that costs $9,000 today and promises to pay annual end-of-year payments of $2,200, $2,500, $2,500, $2,000, and $1,800 over the next 5 years. Or, Bill can invest $9,000 in project B that promises to pay annual end-of-year payments of $1,500, $1,500, $1,500, $3,500, and $4,000 over the next 5 years.
a. How long will it take for Bill to recoup his initial investment in Project A?
b. How long will it take for Bill to recoup his initial investment in Project B?
c. Using the payback period, which project should Bill choose?
d. Do you see any problems with his choice?
|
What is the investment profitability index
: Your firm is considering an investment that will cost $950,000 today. The investment will produce cash flows of $400,000 in year 1, $250,000 in years 2, 3.
|
|
What is the npv of the project
: Your firm is contemplating the purchase of a new $1,498,500 computer-based order entry system. The system will be depreciated straight-line to zero over.
|
|
Are benefits of further education worth the associated costs
: Given her estimates, find the net present value (NPV) of entering this MBA program. Are the benefits of further education worth the associated costs
|
|
Prepare the stockholders equity section of the balance sheet
: Issued 28,000 shares of common stock for cash at $6 per share. Prepare the stockholders' equity section of the balance sheet at December 31, 2010
|
|
Using the payback period, which project should bill choose
: How long will it take for Bill to recoup his initial investment in Project A? b. How long will it take for Bill to recoup his initial investment in Project B
|
|
Differentiate coupon bonds from zero-coupon bonds
: Examine why the expected rate of return on a bond is of interest to the financial manager.
|
|
Construct the huffman code for the keywords and weights
: Construct the Huffman code for the C++ keywords and weights given in the following table:
|
|
Discuss the incorrect price was used on sales invoices
: The incorrect price was used on sales invoices for billing shipments to customers because the wrong price was entered into the computer master file of prices
|
|
Prepare a retained earnings statement
: Prepare a multiple-step income statement- Prepare a retained earnings statement - excluding the tax effect of the earthquake loss which amounted to $15,000
|