Pixel Forge Co. is investigating an investment in machinery that is expected to have a useful life of 7 years. The company uses a discount rate of 15% in its capital budgeting. The net present value of the investment, excluding the salvage value, is −$580,450. (Ignore income taxes.) How large would the salvage value of the machinery have to be for the investment in it to be financially attractive? Note: You will need the PV tables for this question.

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

Which of the following statements is true? An increase in the expected salvage value at the end of a capital budgeting project will increase the internal rate of return for that project. The minimum required rate of return is the discount rate that makes the net present value of the project equal to zero.

Crystal Tech has gathered the following data on a proposed investment project (Ignore income taxes.): Investment required in equipment $ 32,000   Annual cash inflows  $ 6,800   Salvage value of equipment $ 0   Life of the investment 15 years Required rate of return 10%   Crystal uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment. Note: You will need the PV tables for this question. The internal rate of return of the investment is closest to: 

Which of the following statements is true? In the payback method, depreciation is added back to net operating income when computing the annual net cash flow. When a company is cash poor, a project with a short payback period but a low rate of return may be preferred to a project with a long payback period and a high rate of return. A shorter payback period does not necessarily mean that one investment is more desirable than another.

When the level of glucose in the blood rises, chemoreceptors in the body detect this change. The pancreas receives this input, and makes the decision to produce a hormone (insulin) that leads to the liver taking the excess glucose so that blood glucose levels return to normal. In this example, which structure is acting as the control center?

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:

Lunar Tech’s management is investigating the purchase of a small used drone to use in conducting visual inspections of its outdoor industrial facilities. The drone would have a useful life of 5 years. Lunar Tech uses a discount rate of 10% in its capital budgeting. The net present value of the investment, excluding intangible benefits, is- $395,300. (Ignore income taxes.) How large would the annual intangible benefit have to be to make the investment in the drone financially attractive? Note: You will need the PV tables for this question.

River and Co. is considering purchasing a machine that would cost $457,050 and have a useful life of 7 years. The machine would reduce cash operating costs by $83,100 per year. The machine would have a salvage value of $107,120 at the end of the project. (Ignore income taxes.) Compute the payback period for the machine. Note: please round to two decimal places: i.e., 0.00

5)       Select the set corresponding to  .