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could you please help me with solving these answers. 3. Upgrading equipment requires an initial expenditure of $150,000.The upgrade is predicted to generate annual savings

could you please help me with solving these answers.

3.Upgrading equipment requires an initial expenditure of $150,000.The upgrade is predicted to generate annual savings of $25,000 over the next ten years.If capital costs are 8% annually, determine the net present value and decide if the upgrade should be undertaken.

4.A new product is expected to increase annual revenues by $100,000 for 12 years.Bringing the product to market requires an initial investment of $700,000.The investment in this product is to be funded with a loan for the start-up costs, repaid in annual installments. Will the product be profitable if financing can be secured at 10% interest compounded annually? At 9% annually?

5.A company is considering leasing a piece of heavy machinery for $25,000 per year, payable in advance, for a five year project.The machinery has a residual value of $15,000.If the project is expected to yield average annual returns of $34,000 and capital costs are 15% per year, determine the net present value of the project.

6.Development of a new mining project will require an initial investment of $2 million, and $500,000 more at the start of the next two years.The mine is expected to be fully operational in the third year, and to turn a profit of $1.1 million per year, for five years in total.If the cost of capital is 9.5% compounded annually, what is the net present value of the project?

7.A construction company is purchasing new heavy equipment, and is considering two similar pieces of equipment from different manufacturers.The first costs $225,000 and has an expected lifetime of five years.The second costs $350,000 and will last nine years.If capital costs are 7% compounded annually, which manufacturer has the lower annualized cost?

(Hint: the purchase costs are NPVs and the annualized cost is the corresponding PMT.You can treat the annualized costs as an ordinary annuity).

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