User Account

All Pages

What is the irr on the project

Assignment Help Managerial Economics
Reference no: EM13986505

1. With a purchase price of $350,000, a small warehouse provides for an initial before-tax cash flow of $30,000, which grows by 6 percent per year. If the before-tax equity reversion after four years equals $90,000, and an initial equity investment of $175,000 is required, what is the IRR on the project? If the required going-in levered rate of return on the project is 10 percent, should the warehouse be purchased? 

Reference no: EM13986505

Questions Cloud

Revenue and expense transactions : Exploration Services was organized on March 1, 2014. A summary of the revenue and expense transactions for March follows:
Which of the following is an informational report : Which of the following is most likely to be the desired outcome of a persuasive message for a product ?
Calculate the annual percentage rate : Calculate the effective borrowing costs with prepayment in five years. Calculate the lender's yield with prepayment is five years.
Problem regarding the madoff securities : Determine the regulatory oversight that was in place while the Ponzi scheme was operating, and speculate on the main reasons why they did not discover the scheme. Assume you are an auditor for a firm that had $10 million dollars invested in Madoff ..
What is the irr on the project : If the before-tax equity reversion after four years equals $90,000, and an initial equity investment of $175,000 is required, what is the IRR on the project? If the required going-in levered rate of return on the project is 10 percent, should the war..
What distance the block travel : If the spring pushes the block up the incline, what distance, L in meters, will the block travel before coming to rest? The spring remains attached to the block throughout its motion.
Why might a commercial real estate investor : Why might a commercial real estate investor borrow to help finance an investment even if she could afford to pay 100 percent cash?
What magnitude and the direction of smallest magnetic field : A wire with a mass of 1.0 g/cm is placed on a horizontal surface with a coefficient of friction 0.20. The wire carries a current of 1.5 A toward the east, and moves horizontally to the north. What are the magnitude and the direction of the smalles..
Federal trade commission and the department : The Anti-trust laws in the US are dated from the late 1800's and consist primarily of 3 pieces of legislation; the Sherman Act of 1890, in 1914, The Federal Trade Commission (FTC) Act, and the Clayton Act. You can find more information at the FTC ..

Reviews

Write a Review

Managerial Economics Questions & Answers

  Computing the expected return

United State Operations of Audi has been requested through the house office in Frankfurt to estimate the expected return on investment and risk for 2010.

  Describe algebraically the inverse demand curve

Describe algebraically the inverse demand curve faced by the firm in this instance. Provide a graph that is consistent with your answer. Based on this graph, explain why this is called the kinked demand model.

  Voluntary export restraint agreements

Determine what are voluntary export restraint contracts and explain why do some governments force foreign exporters into them instead of just using quotas or tariffs to restrict imports by the same amounts?

  What is the expected profit that jonathan earns

Find the equilibrium contract assuming that Cristina is a monopolist and derive expressions for E(Π1) and E(Π2), the expected value of Cristina's profits from loans that finance Projects 1 and 2 respectively - What is the expected profit that Jonatha..

  How will government regulation impact decision making

How will government regulation impact decision making and will the community's makeup be a consideration for decision makers?

  Does a monopolist achieve efficiency in its production

Does a monopolist achieve efficiency in its production (that is, does it produce where MR = MC)? Will society face a welfare loss in a monopolistic market?

  Explain why or why not if the statement is incorrect

Explain why or why not. If the statement is incorrect, how would you state it correctly?

  Why are some companies more innovative than others

What would be an example of an innovative company? Why is this company innovative? Why are some companies more innovative than others? How should organizations be structured to foster innovation?

  What is the present cost of the machine

What is the present value of the return at 3% and what is the present cost of the machine if the interest rate is 3%?

  Would warehouse operators insist on owning

Would warehouse operators insist on owning their own trucking companies?Why or why not? What coordination and control problems and contractual hazards would these companies encounter?

  Determine the total output

Two local ready mix cement manufacturers, Here and There, have combined demand given through Q = 105 - P. Their total expenses are given by TC = 5Q + 0.5Q2 and TC = 5Q + 0.5Q2.

  Minimum wage has two different results

How high can the minimum wage go before it has a negative effect on employment and why?

Free Assignment Quote

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd