Problem 3.2 CEO Mcintosh is considering an investment option (30 points det His firmony the investments with an RR of Nor more first decides tocate theor ide whether y the above wu rst, you by what in the above to is was done in wolfram apa Unfortunately, this plot crosses the places th e powers of return. These can be seen in the graph, though the exact was show the theme are prom (-1.49,024, 112) The CEO wants to understand what each of thes e we know that since ( If he were to invest $1 and an eneste f o r a single period would become for the first rele. 149, this means of money would become $1.49 of de Simary of the wait another period would turn $2.22 The CEO know this is impossible, otherwise he could get rid of his compan y w i there for period Real interest rates the h orrow the investment, they cann o t. Thus, he knows the first rate can be ignored as a result of the mathematical model moting up with reality. For the second rabe (0.24) the invests $1 at time, this dollar would become t he period and continue shrinking on and on. Although this is not a good rate for anivete h ow he has to take seriously Song 2000 be m e the bedoes have de $1 t for the o the the duheg e chows handed with her w they ten hoes e The first that he could cash flow gentive and the g h eto mathem a te the IRR of the above cash flow streamcathe c owe moved to The CEO now that he don't have to hold on to the money time he can find a temporary fund to invest and the withdraw money to pay for the gative cash flows However, he's not sure how well this will have to do to make the whole plan worthwhile the minimum tractive testere comes 10 calate what the temporary fund's erste l lective wit h what funderest rate makes the overall project have an IRR of 1000 you solve for the of an investment and find that the powe r 1. Which RR is not possible and why? 10 points years, and the salvage value of $200,00U. (10 points) Problem 3.4 If an asset book-depreciates by the DDB method over a 4-year period, how long will it take to reach its salvage value if the estimated salvage is 30% of the first cost? (10 points) Problem 3.2 CEO Mcintosh is considering an investment option (30 points det His firmony the investments with an RR of Nor more first decides tocate theor ide whether y the above wu rst, you by what in the above to is was done in wolfram apa Unfortunately, this plot crosses the places th e powers of return. These can be seen in the graph, though the exact was show the theme are prom (-1.49,024, 112) The CEO wants to understand what each of thes e we know that since ( If he were to invest $1 and an eneste f o r a single period would become for the first rele. 149, this means of money would become $1.49 of de Simary of the wait another period would turn $2.22 The CEO know this is impossible, otherwise he could get rid of his compan y w i there for period Real interest rates the h orrow the investment, they cann o t. Thus, he knows the first rate can be ignored as a result of the mathematical model moting up with reality. For the second rabe (0.24) the invests $1 at time, this dollar would become t he period and continue shrinking on and on. Although this is not a good rate for anivete h ow he has to take seriously Song 2000 be m e the bedoes have de $1 t for the o the the duheg e chows handed with her w they ten hoes e The first that he could cash flow gentive and the g h eto mathem a te the IRR of the above cash flow streamcathe c owe moved to The CEO now that he don't have to hold on to the money time he can find a temporary fund to invest and the withdraw money to pay for the gative cash flows However, he's not sure how well this will have to do to make the whole plan worthwhile the minimum tractive testere comes 10 calate what the temporary fund's erste l lective wit h what funderest rate makes the overall project have an IRR of 1000 you solve for the of an investment and find that the powe r 1. Which RR is not possible and why? 10 points years, and the salvage value of $200,00U. (10 points) Problem 3.4 If an asset book-depreciates by the DDB method over a 4-year period, how long will it take to reach its salvage value if the estimated salvage is 30% of the first cost? (10 points)