Bruno’s Lunch Counter is expanding and expects operating cash flows of $25,600 a year for 4 years as a result. This expansion requires $69,000 in new fixed assets. These assets will be worthless at the end of the project. In addition, the project requires $5,800 of net working capital throughout the life of the project, which will be fully recovered at the end. What is the net present value of this expansion project at a required rate of return of 13 percent?

Our firm is investing in its production capacity. The expansion will require a $920,000 investment in new property, plant, and equipment. The expansion will increase sales, which will necessitate an investment of $15,000 and $45,000 in new inventory and accounts receivable, respectively. Expanded sales will require more materials from our suppliers, which will increase our accounts payable by $35,000. What is the investment’s initial cost?

Which political model suggests that individuals and organizations compete in the political “marketplace” trying to win support from the people?

Mountain Frost is considering a new project with an initial cost of $218,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net income for each year is $24,800,$20,800, $27,900, and $18,200,respectively. What is the average accounting return?

What is the yield to maturity of a $1,000-face value bond that matures in 10 years and pays a 5.5 percent, semiannual coupon if it trades at $1,019.50?

A project with an initial cost of $39,600 is expected to provide cash flows of $8,840, $11,750, $8,810, and $9,650 over the next four years, respectively. If the required return is 12.3 percent, what is the project’s profitability index?

What is the yield to maturity of a $1,000-face value bond that matures in 12 years and pays a 4 percent, semiannual coupon if it trades at $922.25?

A project has a unit price of $32.90, a variable cost per unit of $11.51, fixed costs of $402,000, and depreciation expense of $43,000. Ignore taxes. What is the accounting break-even quantity?

Alt’s is contemplating the purchase of a new $157,000 computer-based order entry system. The system will be depreciated straight-line to zero over the system’s five-year life. The system will be worthless at the end of five years. The company will save $47,100 before taxes per year in order processing costs and will reduce its net working capital by $11,000 immediately. The net working capital will return to its original level when the project ends. The tax rate is 21 percent. What is the internal rate of return for this project?

Mountain Frost is considering a new project with an initial cost of $205,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net income for each year is $20,000,$20,900, $24,600, and $16,900,respectively. What is the average accounting return?