Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) A mine can yield= 16,000 ounces of silver at variable cost of= $36 per ounce. Fixed costs of operating mine are= $48,000 per year. In half years, silver can be sold for= $52 per ounce; in other years, silver can be sold for only= $26 per ounce. Ignore taxes.

a) Determine the average cash flow you will get from mine if it is forever kept in operation and silver always is sold in year it is mined?

b) Now assume you can shut down mine in years of low silver prices. Compute average cash flow from mine.

2) Though, you identify that some of these estimates are subject to error. Assume that each variable may turn out to be either 10% higher or 10% lower than initial estimate. Project will last for ten years and needs the initial investment of= $1.4 million, which will be declined straight-line over project life to final value of zero. Firm’s tax rate is= 40% and required rate of return is 14%.

a) Determine project NPV in “best-case scenario,” i.e., suppose all variables take on best possible value?

b) Determine project NPV in the worst-case scenario?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M915126

Have any Question? 


Related Questions in Basic Finance

Design a one-way experiment to test each of the given

Design a one-way experiment to test each of the given research hypotheses: a. The more a person tries not to think of something, the more he or she will actually end up thinking about it. b. People are more helpful when ...

Why do you suppose countries impose foreign exchange

Why do you suppose countries impose foreign exchange controls? Do you think that, long-term, foreign exchange controls will encourage or discourage inward foreign investment?

Ethical dilemma- rita is the office manager of a

Ethical Dilemma:- Rita is the office manager of a three-doctor practice. Her brother, Juan, a recent college graduate, recently started working for a large insurance company that specializes in health insurance. In attem ...

Gork musical instruments produces several products one of

Gork Musical Instruments produces several products, one of which is facing increasing competition from cheaper, plastic alternatives. It expects that in coming years the number of units sold will fall by 10% pa. In the y ...

Hotfoot shoes would like to maintain its cash account at a

HotFoot Shoes would like to maintain its cash account at a minimum level of $43,000, but expects the standard deviation in net daily cash flows to be $5,800, the effective annual rate on marketable securities to be 5.7 p ...

1 what are the main reasons that lenders charge interest on

1. What are the main reasons that lenders charge interest on loans? 2. Give an example of a financial transaction that requires a payment in the future. 3. If you deposit $1,000 in a bank CD that pays interest of 3% per ...

Writing in the wall street journal vincent reinhart the

Writing in the Wall Street Journal, Vincent Reinhart, the former director of the Federal Reserve's division of monetary affairs, argued: The problem with securitization is that it dilutes individual responsibility. The m ...

1 since the 1960s which measure of the money supply has

1. Since the 1960s, which measure of the money supply has grown more rapidly, M1 or M2? Briefly explain why this is the case. Has the growth of M1 been more or less stable than the growth rate of M2? 2. Define liquidity. ...

1 why should we be cautious about reports of research that

1. Why should we be cautious about reports of research that are published in the popular media and posted on the world wide web? 2. What are the three central characteristics of good writing? 3. Why should authors avoid ...

1 credit from utilities how do utilities extend credit and

1. Credit from Utilities. How do utilities extend credit and how can this credit help you establish a credit history? 2. Impact of Credit Report. Explain how a weak credit report can affect you. 3. Credit Bureaus. Name t ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro