Steve's Sub Shop is considering investing in toaster ovens for each of its 120 stores located in the southwestern United States. The high capacity conveyor toaster ovens will require an initial investment of $15,000 per store plus $1,500 in installation costs. The new capital (including installation costs) will be depreciated over five years using straight-line depreciation toward a zero salvage value. In addition, Steve will incur additional maintenance expenses totaling $120,000 per year to maintain the ovens (this is the total for all the stores). Those costs are expected to grow at 3% per year after t=1. Currently, revenues for the 120 stores total $9 million and the firm estimates that adding the toaster ovens will increase revenue by 10%. Revenues are expected to grow at 5% per year after t=1. In five years, Steve expects to sell the ovens for $750 each. Net working capital should increase immediately by $50,000 and will exactly reverse at t= 5. (a) Calculate the expected free cash flows (PFCF) for each or the next five years if the tax rate is 36%. (Do this for the aggregate of all the stores.)

(b) Assume a 15% discount rate on this project. Calculate the project's NPV, IRR, and payback. Should the project be accepted?

Kenney co. uses process costing to account for the production of canned energy drinks. direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process. equivalent units have been calculated to be 19,200 units for materials and 16,000 units for conversion costs. beginning inventory consisted of $11,200 in materials and $6,400 in conversion costs. april costs were $57,600 for materials and $64,000 for conversion costs. ending inventory still in process was 6,400 units (100% complete for materials, 50% for conversion). the total cost per unit using the weighted average method would be closest to:

< back to assignment attempts: 1 1 keep the highest: 1 / 2 2. determining opportunity cost juanita is deciding whether to buy a suit that she wants, as well as where to buy it. three stores carry the same suit, but it is more convenient for juanita to get to some stores than others. for example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $102 for the suit: store travel time each way price of a suit (minutes) (dollars per suit) local department store 15 102 across town 30 88 neighboring city 60 65 juanita makes $42 an hour at work. she has to take time off work to purchase her suit, so each hour away from work costs her $42 in lost income. assume that returning to work takes juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. as you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling. complete the following table by computing the opportunity cost of juanita's time and the total cost of shopping at each location. store opportunity cost of time price of a suit total cost (dollars) (dollars per suit) (dollars) local department store 102 across town 88 neighboring city 65 assume that juanita takes opportunity costs and the price of the suit into consideration when she shops. juanita will minimize the cost of the suit if she buys it from the . grade it now save & continue continue without saving

The prebisch–singer hypothesis concludes that: a. technology lowers the cost of manufactured products, so developing countries should see an increase in their terms of trade. b. developing countries experience a long-run decline in their terms of trade, as the demand for primary products in higher-income countries declines relative to their demand for manufactured goods. c. because of unfair trading practices, labor in developing countries is exploited. d. opec has been responsible for a slowdown in the world's standard of living.