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Assume compound interest unless otherwise stated. Must be solved with factors and / or Excel PV , FV , PMT , NPER, or interest rate
Assume compound interest unless otherwise stated. Must be solved with factors andor Excel PV FV PMT NPER, or interest rate functions; you may not use NPV Formulation including factors calculations must be shown. For each problem, include a cash flow diagram. If Excel is used for calculations, include the Excel formulas used. a A new process costs $ to install at time and $ at time It will then save the company $ per year for years Equipment in the process will require turnarounds maintenance events in year costing $ and year costing $ At interest, what is the equivalent present worth of this project? Also, at this interest rate, is the project worth doing? explain why or why not b A automotive manufacturer has a year now to end of year fixed price contract with a supplier for parts costing $ per year. Once the contract ends, the cost is expected to rise at per year through year Find the equivalent and A for these cashflows at c A investment costs $ at time to implement, but will return $ at end of year $ at end of year and $ at end of year What is the rate of return on this investment? hint: use IRR function in Excel
Assume compound interest unless otherwise stated. Must be solved with factors andor Excel PV FV PMT NPER, or interest rate functions; you may not use NPV
Formulation including factors calculations must be shown. For each problem, include a cash flow diagram. If Excel is used for calculations, include the Excel formulas used.
a A new process costs $ to install at time and $ at time It will then save the company $ per
year for years Equipment in the process will require turnarounds maintenance events in year costing $
and year costing $ At interest, what is the equivalent present worth of this project? Also, at this interest
rate, is the project worth doing? explain why or why not
b A automotive manufacturer has a year now to end of year fixed price contract with a supplier for parts
costing $ per year. Once the contract ends, the cost is expected to rise at per year through year Find the
equivalent and A for these cashflows at
c A investment costs $ at time to implement, but will return $ at end of year $ at end of year
and $ at end of year What is the rate of return on this investment? hint: use IRR function in Excel
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