You currently don't have a car, but rent a car that's parked just outside your house whenever you need one. your annual expenditure on rental cars is $2,200.
you've now considering purchasing a car that would give you the same level of convenience as your current life style. the car costs $23,000 and can be sold for $5,000 after 10 years. you'd purchase the car with money from your savings account which always earns an interest rate of 6%.
assume that all cash flows occur at the end of each year (maybe because you drive much more around and christmas).
part 1) what is the present value of the benefits of owning that car, ie., saving on rental expenses and selling the car?
part 2) should you buy the car? o no o yes

Shrieves casting company is considering adding a new line to its product mix, and the capital budgeting analysis is being conducted by sidney johnson, a recently graduated mba. the production line would be set up in unused space in the main plant. the machinery’s invoice price would be approximately $200,000, another $10,000 in shipping charges would be required, and it would cost an additional $30,000 to install the equipment. the machinery has an economic life of 4 years, and shrieves has obtained a special tax ruling that places the equipment in the macrs 3-year class. the machinery is expected to have a salvage value of $25,000 after 4 years of use. the new line would generate incremental sales of 1,250 units per year for 4 years at an incremental cost of $100 per unit in the first year, excluding depreciation. each unit can be sold for $200 in the first year. the sales price and cost are both expected to increase by 3% per year due to inflation. further, to handle the new line, the firm’s net working capital would have to increase by an amount equal to 12% of sales revenues. the firm’s tax rate is 40%, and its overall weighted average cost of capital, which is the risk-adjusted cost of capital for an average project (r), is 10%. define “incremental cash flow.” (1) should you subtract interest expense or dividends when calculating project cash flow?

According to this excerpt, a key part of our national security strategy is

Given the following information about the closed economy of brittania, what is the level of investment spending and private savings, and what is the budget balance? assume there are no government transfers. gdp=$1180.00 million =$510.00 million =$380.00 million =$280.00 million