i) Northern Track is developing a special vehicle for Arctic exploration. The development requires investments [outlays] of
Question:
i) Northern Track is developing a special vehicle for Arctic exploration. The development requires investments [outlays] of $50,000 in year 1, $40,000 in year 2, and $30,000 in year 3. Net returns [inflows] starting at year 4 are expected to be $27,000 per year for the next 12 years. If the company requires a rate of return of 12%, calculate the net present value of the project.
ii)Your firm is considering introducing a new product for which net returns are expected to be,
Year 1 to Year 3 inclusive: $2000 per year
Year 4 to Year 8 inclusive: $5000 per year
Year 9 to Year 12 inclusive: $3000 per year
The introduction of the product requires an immediate outlay of $15 000 for equipment estimated to have a salvage value of $2000 after twelve years. Find the rate of return .
Looking forward to see your help so I can proceed on.I a attaching list of formulas,may help you.Thank you.
Contemporary Business Mathematics with Canadian Applications
ISBN: 978-0133052312
10th edition
Authors: S. A. Hummelbrunner, Kelly Halliday, K. Suzanne Coombs