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Use the cash flows and competitive spreads shown in the table below. millions Year 0 Year 1 Year 2 Years 3-10 Investment 40 Production (millions

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Use the cash flows and competitive spreads shown in the table below. millions Year 0 Year 1 Year 2 Years 3-10 Investment 40 Production (millions of pounds per year) 95 1.10 Spread per pound) 1.10 1.10 1.10 104.50 60.50 Net revenues 45.00 45.00 Production costs Transport Other costs 35 35 40 35 19.50 -24.50 Cash flow NPV (at 8% Assume the dividend payout ratio each year is 100%. a. Calculate the year-by-year book and economic profitability for investment in polyzone production. Assume straight-line depreciation over 10 years and a cost of capital of 8%. (Negative answers should be indicated by a minus sign. Leave no cells blank be certain to enter "o" wherever required. Do not round intermediate calculations. Enter your income answers in millions rounded to 2 decimal places and enter the rate of return as a percent rounded to 2 decimal places.) 0 1 2 3 4 5 Period: Book income Book rate of return Economic income (S) Book income Book rate of return Economic income Use the cash flows and competitive spreads shown in the table below. millions Year 0 Year 1 Year 2 Years 3-10 Investment 40 Production (millions of pounds per year) 95 1.10 Spread per pound) 1.10 1.10 1.10 104.50 60.50 Net revenues 45.00 45.00 Production costs Transport Other costs 35 35 40 35 19.50 -24.50 Cash flow NPV (at 8% Assume the dividend payout ratio each year is 100%. a. Calculate the year-by-year book and economic profitability for investment in polyzone production. Assume straight-line depreciation over 10 years and a cost of capital of 8%. (Negative answers should be indicated by a minus sign. Leave no cells blank be certain to enter "o" wherever required. Do not round intermediate calculations. Enter your income answers in millions rounded to 2 decimal places and enter the rate of return as a percent rounded to 2 decimal places.) 0 1 2 3 4 5 Period: Book income Book rate of return Economic income (S) Book income Book rate of return Economic income

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