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Pred and Preds have always wanted to enter the blueberry business. They locate a 30-acre piece of hillside in Maine that is covered with blueberry bushes. They figure that the annual yield from the brushes will be 150 crates. Each crate eestimated to sell for $400 for the next 5 years. This price is expected to rise to scop per crate for all sales from years 6 through 10. In order to get started, Pred and Friede must pay $125,000 for the lend plus $20,000 for packing equipment. The packing equipment will be depreciated on a straight-tne besis to a zero estimated salvage value at the end of 10 years, Fred and Frieda belleve that at end of 10 years, they will want to retire to Fiarida and sell their property, Annual aperating expenses, including alates to Fred and Friede and exclusive of depreciation, are estimated to be $30,000 per year for the first 5 years and $50,000 thereafter. The land is expected to appreciate in value ata rate of 5 percent per year The couple's marginal tax rate le 30 percent for both ordinary income and capital gains and losses. Ne Thole Tabia II, and Table TV to answer the questions a 27 the couple requires at least a 16 percent return on their investment, calculate the net present value of the blueberry business. Round your answer to the r eberry business? dollar. Should the couple enter the Select because NPV b. Assume that the land can be sold for only $60,000 at the end of 10 years (a capital loss of $65,000), Calculate the new net present value of the Mueberry business. (Assume that the couple may daim the full amount of their capital loss in the year it occure-year 10.) Round your answer to the nearest dollar Should the couple Invest in the land and blueberry business? because NPV Select 0 Should the couple enter the blueberry business? -Select-, because NPV -Select- O nly $60,000 at the end year 10.) Round your b. Assume that the land can b -Select- their capital loss in the year $ Should the couple invest in -Select-, because NPV 11 d blueberry business? 0 Should the couple enter the blueberry business? -Select-, because NPV -Select-0 Select Yes No -Select- t the land can be sold for only $60,000 at the end of 10 years (a capital loss of s loss in the year it occurs-year 10.) Round your answer to the nearest dollar. couple invest in the land and blueberry business? , because NPV -Select-0 Should the couple invest in the land and blueberry business? -Select- v because NPV -Select- 0 Icon Key " -Select- 11 Should the couple invest in the land and blueberry business? -Select-, because NPV -Select- 0 -Select- Yes No Icon Key Fred and Frieda have always wanted to enter the blueberry business. They locate a 50-acre piece of hillside in Maine that is covered with blueberry bushes. They figure that the annual yield from the bushes will be 150 crates. Each crate is estimated to sell for $400 for the next 5 years. This price is expected to rise to $600 per crate for all sales from years 6 through 10. In order to get started, Fred and Frieda must pay $125,000 for the land plus $20,000 for packing equipment. The packing equipment will be depreciated on a straight-line basis to a zero estimated salvage value at the end of 10 years. Fred and Frieda believe that at the end of 10 years, they will want to retire to Florida and sell their property. Annual operating expenses, including salaries to Fred and Frieda and exclusive of depreciation, are estimated to be $30,000 per year for the first 5 years and $50,000 thereafter. The land is expected to appreciate in value at a rate of 5 percent per year. The couple's marginal tax rate is 30 percent for both ordinary income and capital gains and losses. Use Table 1, Table II, and Table IV to answer the questions. a. If the couple requires at least a 16 percent return on their investment, calculate the net present value of the blueberry business. Round your answer to the nearest dollar. $ Should the couple enter the blueberry business? -Select- v , because NPV -Select-0 b. Assume that the land can be sold for only $60,000 at the end of 10 years (a capital loss of $65,000). Calculate the new net present value of the blueberry business. (Assume that the couple may claim the full amount of their capital loss in the year it occurs-year 10.) Round your answer to the nearest dollar. $ Should the couple invest in the land and blueberry business? -Select- v because NPV -Select-0 Pred and Preds have always wanted to enter the blueberry business. They locate a 30-acre piece of hillside in Maine that is covered with blueberry bushes. They figure that the annual yield from the brushes will be 150 crates. Each crate eestimated to sell for $400 for the next 5 years. This price is expected to rise to scop per crate for all sales from years 6 through 10. In order to get started, Pred and Friede must pay $125,000 for the lend plus $20,000 for packing equipment. The packing equipment will be depreciated on a straight-tne besis to a zero estimated salvage value at the end of 10 years, Fred and Frieda belleve that at end of 10 years, they will want to retire to Fiarida and sell their property, Annual aperating expenses, including alates to Fred and Friede and exclusive of depreciation, are estimated to be $30,000 per year for the first 5 years and $50,000 thereafter. The land is expected to appreciate in value ata rate of 5 percent per year The couple's marginal tax rate le 30 percent for both ordinary income and capital gains and losses. Ne Thole Tabia II, and Table TV to answer the questions a 27 the couple requires at least a 16 percent return on their investment, calculate the net present value of the blueberry business. Round your answer to the r eberry business? dollar. Should the couple enter the Select because NPV b. Assume that the land can be sold for only $60,000 at the end of 10 years (a capital loss of $65,000), Calculate the new net present value of the Mueberry business. (Assume that the couple may daim the full amount of their capital loss in the year it occure-year 10.) Round your answer to the nearest dollar Should the couple Invest in the land and blueberry business? because NPV Select 0 Should the couple enter the blueberry business? -Select-, because NPV -Select- O nly $60,000 at the end year 10.) Round your b. Assume that the land can b -Select- their capital loss in the year $ Should the couple invest in -Select-, because NPV 11 d blueberry business? 0 Should the couple enter the blueberry business? -Select-, because NPV -Select-0 Select Yes No -Select- t the land can be sold for only $60,000 at the end of 10 years (a capital loss of s loss in the year it occurs-year 10.) Round your answer to the nearest dollar. couple invest in the land and blueberry business? , because NPV -Select-0 Should the couple invest in the land and blueberry business? -Select- v because NPV -Select- 0 Icon Key " -Select- 11 Should the couple invest in the land and blueberry business? -Select-, because NPV -Select- 0 -Select- Yes No Icon Key Fred and Frieda have always wanted to enter the blueberry business. They locate a 50-acre piece of hillside in Maine that is covered with blueberry bushes. They figure that the annual yield from the bushes will be 150 crates. Each crate is estimated to sell for $400 for the next 5 years. This price is expected to rise to $600 per crate for all sales from years 6 through 10. In order to get started, Fred and Frieda must pay $125,000 for the land plus $20,000 for packing equipment. The packing equipment will be depreciated on a straight-line basis to a zero estimated salvage value at the end of 10 years. Fred and Frieda believe that at the end of 10 years, they will want to retire to Florida and sell their property. Annual operating expenses, including salaries to Fred and Frieda and exclusive of depreciation, are estimated to be $30,000 per year for the first 5 years and $50,000 thereafter. The land is expected to appreciate in value at a rate of 5 percent per year. The couple's marginal tax rate is 30 percent for both ordinary income and capital gains and losses. Use Table 1, Table II, and Table IV to answer the questions. a. If the couple requires at least a 16 percent return on their investment, calculate the net present value of the blueberry business. Round your answer to the nearest dollar. $ Should the couple enter the blueberry business? -Select- v , because NPV -Select-0 b. Assume that the land can be sold for only $60,000 at the end of 10 years (a capital loss of $65,000). Calculate the new net present value of the blueberry business. (Assume that the couple may claim the full amount of their capital loss in the year it occurs-year 10.) Round your answer to the nearest dollar. $ Should the couple invest in the land and blueberry business? -Select- v because NPV -Select-0