11) Select the law that establishes that the two sets below are equal.  

Cedar House Corp. has not yet decided on the required rate of return to use in its capital budgeting. This lack of information will prevent Cedar House from calculating a project’s:   Payback Net Present Value Internal Rate of Return 1) No No No 2) Yes Yes Yes 3) No Yes Yes 4) No Yes No

Ridge Outfitters is considering a project that would require an investment of $334,000 and would last for 8 years. The incremental annual revenues and expenses generated by the project during those 8 years would be as follows (Ignore income taxes.): Sales $ 230,000 Variable expenses 18,000 Contribution margin 212,000 Fixed expenses:   Salaries 36,000 Rents 49,000 Depreciation 44,000 Total fixed expenses 129,000 Net operating income $ 83,000 The scrap value of the project’s assets at the end of the project would be $26,000. The cash inflows occur evenly throughout the year. The project’s payback period is closest to:

Nest and Co. is considering the acquisition of a new machine that costs $355,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that the machine would produce are (Ignore income taxes.):   Incremental Net Operating Income Incremental Net Cash Flows Year 1 $ 62,000 $ 148,000 Year 2 $ 68,000 $ 154,000 Year 3 $ 79,000 $ 165,000 Year 4 $ 42,000 $ 128,000 Year 5 $ 84,000 $ 170,000 Assume cash flows occur uniformly throughout a year except for the initial investment. The payback period of this investment is closest to:

Terra Goods has provided the following data concerning an investment project that it is considering: Initial investment $ 280,000   Annual cash flow  $ 128,000 per year Expected life of the project 4 years Discount rate 9%   Note: You will need the PV tables for this question. The net present value of the project is closest to:

12)     Select the the expression that is an element of  .

5)       Select the set corresponding to  .

North Pine Partners is considering the purchase of a machine that would cost $240,000 and would last for 10 years. At the end of 10 years, the machine would have a salvage value of $21,500. By reducing labor and other operating costs, the machine would provide annual cost savings of $37,000. The company requires a minimum pretax return of 10% on all investment projects. (Ignore income taxes.) Please use PV tables to complete this problem. The net present value of the proposed project is closest to: Note: please format your response rounded to the nearest whole dollar and please place dollar signs inside parentheses; i.e., $0,000 or ($0,000)

Copper Labs has invested in a machine that costs $78,000, has a useful life of six years, and has no salvage value at the end of its useful life. The machine is being depreciated by the straight-line method, based on its useful life. The machine will have a payback period of four years. Given these data, the simple rate of return on the machine is closest to (Ignore income taxes.):

Nova Cloud’s management is considering investing in aircraft that would have a useful life of 7 years. The company uses a discount rate of 12% in its capital budgeting. The net present value of the investment, excluding the annual cash inflow, is −$405,814. (Ignore income taxes.) How large would the annual cash inflow have to be to make Nova’s investment in the aircraft financially attractive? Note: You will need the PV tables for this question.