Pinto plc is considering spending 10,000 on insulating its office, which will save it 1,000 per year

Question:

Pinto plc is considering spending €10,000 on insulating its office, which will save it €1,000 per year in heating expenses in perpetuity.

(a) What is the NPV of the investment when the cost of capital is 8 per cent?

(b) What is the IRR of the investment?

(c) What is the payback period of the investment?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Corporate Finance

ISBN: 9780077173630

3rd Edition

Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe

See More Books

Question Posted: Feb 19, 2024 01:01 AM

See More Questions

Carlton plc is considering two alternative investment projects one for the expansion of its existing business, and another for diversification into petroleum products. These are mutually exclusive...
Identify products with shorter life cycle and discuss. Why is the median a better representative of the dataset than the mean? What is impulse purchase? How does this contribute to retail marketing?
The board of directors of Portand Ltd are considering two mutually exclusive investments each of which is expected to have a life of five years. The company does not have the physical capacity to...
A pistoncylinder device contains superheated steam. During an actual adiabatic process, the entropy of the steam will (never, sometimes, always) increase.
Domremy Drywall Inc. needs to purchase new equipment to better service its client accounts. The cost of the equipment is $175,000. It is estimated that the firm will save $35,000 annually (after tax)...
What is the slope of the line determined by the equation 2x 3y = 6? F. 6 G. 3 H. 3/2 J. 2/3 K. 2
A material processing oven has a first cost of $\$ 16,999$ with a life of 10 years and a salvage value of $\$ 2,500$. The corporate MARR is $12 \%$. If the system provides about $\$ 2,750$ annually,...
Kahil Mfg. makes skateboards and uses a weighted average process costing system. On May 1, 2013, the company had 400 boards in process that were 70 percent complete as to material and 85 percent...
What I learnt? Customer Behaviour: 1) Customer satisfaction only results in loyalty at the highest level of satisfaction - do not focus entirely on satisfaction 2) Improvements that are not...
The treasurer of Amaro Canned Fruits has projected the cash flows of projects A, B and C as follows. Suppose the relevant discount rate is 12 per cent a year. (a) Compute the profitability index for...
Sandy Grey Ltd is in the process of deciding whether or not to revise its line of mobile phones which it manufactures and sells. Their sole market is large corporations and they have not as yet...
Cisco Systems, Inc., reports the following in the Commitments and Contingencies note to their 10-K for the year ended July 2018. Purchase Commitments with Contract Manufacturers and Suppliers: We...
Simpson Auto Body Repair purchased $20,000 of Machinery. The company paid $8,000 in cash at the time of the purchase and signed a promissory note for the remainder to be paid in four monthly...
A 0.20-kg block moves at the end of a 0.50 m string along a circular path on a friction-less air table. The block's initial rotational speed is 2.0 rad/s. As the block moves in the circle, the string...
Give a brief descriptions of different types of memory. 2. Draw and explain memory hierarchy according to time, size and cost. 3. Steps of Cache memory working procedure. 4. Draw the hardware...
Discuss a case where Cache Memory actually slows-down performance? How does cache memory affect system performance?
Design the memory mapping between the cache memory of 8 MB to the main memory of 4 GB using way set associative method where the block or page or frame size is of 4 KB. Consider each memory location...
Copyright Confusion: Myths and Facts Your Task. You overheard the following statements as a group of college students discussed copyright issues. Which of these statements do you think are true and...
Represent each of the following combination of units in the correct SI form using an appropriate prefix: (a) m/ms, (b) k m, (c) k s /mg, and (d) k m N.
Real Cash Flows When Marilyn Monroe died ex-husband Joe DiMaggio vowed to place fresh flowers on her grave every Sunday as long as he lived. The week after she died in 1962, a bunch of fresh flowers...
Real Cash Flows you are planning to save for retirement over the next 30 years. To save for retirement, you will invest $700 a month in a stock account in real dollars and $300 a month in a bond...
Stock Valuation why does the value of a share of stock depend on dividends?
1. For the arithmetic series + 5 79 10 + 65 +..... calculate t10 and $10.
Problem 3 For a multiple linear regression model with 4 variables, where ~ Y = Bo+B1X1 + B2X2 + 3X3 + B4X4 + , N(0,2), what is the test statistic for each of the following tests? and what is the...
4. Consider a quantum system Q described by a Hilbert space H. (a) Suppose we are given a subspace Ho of H and a linear map from kets in Ho to others in h. That is, Vo)), in a linear way. This map...

Pinto plc is considering spending 10,000 on insulating its office, which will save it 1,000 per year

Question:

Step by Step Answer:

Pinto plc Office Insulation Analysis Given Investment cost 10000 Annual savings 1000 Cost of capital ...View the full answer

Corporate Finance

Students also viewed these Business questions