You are considering a luxury apartment building project that requires an investment of $15,500,000, which comprises $12,000,000 for the building and $3,500,000 for land

You are considering a luxury apartment building project that requires an investment of $12,500,000. The building has 50 units. You expect the maintenance cost for the apartment building to be $250,000 the first year and $300,000 the second year. The maintenance cost will continue to increase by $50,000 in subsequent years. The cost to hire a manager for the building is estimated to be $80,000 per year. After five years of operation, the apartment building can be sold for $14,000,000. What is the annual rent per apartment unit that will provide a return on investment of 15%? Year Initial Investment Maintenance Cost Manager's cost Salvage Value Net Cash flow Discount Factor @ 15% Discounted Amount 0 (12,500,000) (12,500,000) 1 (12,500,000) 1 (250,000) (80,000) (330,000) 0.870 (286,957) 2 (300,000) (80,000) (380,000) 0.756 (287,335) 3 (350,000) (80,000) (430,000) 0.658 (282,732) 4 (400,000) (80,000) (480,000) 0.572 (274,442) 5 (450,000) (80,000) 14,000,000 13,470,000 0.497 6,696,971 Present Value of Cash flows (6,934,494) Inflows required = Present Value of Cash flows / Discount factors  15% for 5 years Inflows required = 6934494/3.352 Inflows required = $ 2,068,667.42 Proof : Year Initial Investment Maintenance Cost Manager's Can cost up to $300,000.

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation:

answer; because many corporate watch groups will discover and publicize unethical behavior by suppliers, link it to the american company, and harm its reputation;