Question: Amazon is considering adding a fleet of drones to its company. These drones cost $2,000 each. Each drone is expected to generate an annual revenue

Amazon is considering adding a fleet of drones to its company. These drones cost $2,000 each. Each drone is expected to generate an annual revenue of $800 and has a useful life of 3 years. After 3 years of operation, it has negligible salvage value. What is the external rate of return for each drone? Assume Amazon's MARR is 12%. Click here to access the TVMFactor Table calculator. Carry all interim calculations to 5 decimal places and then round your final answer to 1 decimal place. The tolerance is 0.2. Should Amazon invest in these drones

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Amazon is considering adding a fleet of drones to its company. These drones cost \ ( \ $ 3 , 0 0 0 \ ) each. Each drone is expected to generate an annual revenue of \ ( \ $ 8 0 0 \ ) and has a useful...

Amazon is considering adding a Fleet of drones to its company. These drones cost 2700 each. Each drone is expected to generate an annual revenue of $900 and has a useful life of 4 years of operation,...

Amazon is considering adding a fleet of drones to its company. These drones cost $2,000 each. Each drone is expected to generate an annual revenue of $800 and has a useful life of 3 years. After 3...

Amazon is considering adding a fleet of drones to its company. These drones cost $3,300 each. Each drone is expected to pr annual revenue of $800 and has a useful life of 6 years. After 6 years of...

Amazon is considering adding a fleet of drones to its company. These drones cost $2,000 each. Each drone is expected to generat an annual revenue of $800 and has a useful life of 3 years. After 3...

Amazon is considering adding a fleet of drones to its company. These drones cost $2,700 each. Each drone is expected to generate an annual revenue of $900 and has a useful life of 4 years. After 4...

answer these questions please, thank you! 24. Bravo Pty Ltd is considering the addition of a new product line. The new product will require an i tiai capital outtay 01 $70 000 and is expected to have...

Acct 605 Fa23 Final Exam i Saved Help Save & Ex 2 Assume a company makes only three products, A, B, and C: Product A Product B Product C Estimated customer demand in units 700 600 800 Selling price...

note : 800 words each question. Gopro in 2017: Wi11 Its Turnaround Strategy Restore Profitability? contect DAVID L. TURNIPSEED University of South Alabama JOHN E. GAMBLE Texas A\&M University-Corpus...

Please explain the below chart in more than 1 page. (i.e.. ROE, Credit Rating, Image Rating, Net Revenue, Net Profit, Earnings Per Share, Action-Capture Camera Design and UAV Drone Design in North...

In a survey of 703 randomly selected workers, 429 got their jobs through networking (based on data from Taylor Nelson Sofres Research). a. Use the sample data with a 0.05 significance level to test...

Oasis Company has used the dollar-value LIFO method for inventory cost determination for many years. The following data were extracted from Oasiss records. Instructions Calculate the index used for...

Option Pricing: PV of Cap. Ex. (Yrs. 1-2) 8.7 Maturity 4.0 PV of NCF 27.2 Risk free rate 4.0%Volatility 30%BS calculations: d1 2.46 N(d1) 0.99 d2 1.86 N(d2) 0.97 Price of call 19.77 Difference: -...

10) For a bond that pays cash interest (i.e., not a zero coupon bond), YTM is (a) always equal to the coupon rate (b) always equal to the current yield (c) is always less than the coupon rate (d) can...

C Have you ever witnessed the beginning tremors of a smart mob in any of the social networks of which you are a part? What kinds of goals might motivate you to join a smart mob?

In Chapter 7, we talked about family as an example of interpersonal relationships. Now think about your family as a group. What are the familys common goals? What do the members of your family see as...

Think about your experience as part of a group to which you no longer belongan old job, your high school class, or a club that youre not a part of anymore. Did the group go through all five phases...