Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

can you help with calculations? Worldwide widget manufacturing inc, wants to add two new production lines of widgets. you're asked to analyze whether to go

 
 

can you help with calculations?
Worldwide widget manufacturing inc, wants to add two new production lines of widgets. you're asked to analyze whether to go forward with two mutually exclusive projects. the cash flows of both projects are displayed below. your company uses a cost of capital of 9 percent to evaluate projects such as the two you're now analyzing. 

SHOW CALCULATIONS

Calculate the payback of Project A
calculate the payback of Project B
calculate the IRR of Project A
calculate the IRR of Project B
Using the NPV method and assuming a cost of capital of 6 percent, calculate the NPV of these two projects. which of these mutually exclusive projects should the company accept?

There is an infinite-lived representative consumer with preferences given by Y t=0 where 0 0, h is the human capital of the representative consumer, and ut is time spent by the consumer in the production of consumption goods. The consumer spends vt units of time in each period working for the government, with production of government-consumed goods given by gt = nhvt, where n> 0. The government sets vt = v, a constant, for t = 0,1,2,. Human capital is produced according to ht+1 = hext, where 8>0 and x, is the quantity of time devoted to human capital accumulation. x, 1-u; -v a. Determine the paths followed by consumption and human capital and determine how the consumer allocates time to the production of consumption goods and human capital accumulation in each period. b. How are the growth rates of consumption and human capital, and the allocation of the consumer's time affected by a change in v? Explain your results.,

Step by Step Solution

3.45 Rating (148 Votes )

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Transport Operations

Authors: Allen Stuart

2nd Edition

978-0470115398, 0470115394

More Books

Students also viewed these General Management questions