eng111_HW4

eng111_HW4 - ENG 111 HW4 Winter 2009 Note: 1. Put your...

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ENG 111 HW4 Winter 2009 Note: 1. Put your name, id number, section number on top of your solutions. 2. Submit your solution in electronic format in .pdf or .doc. 3. Plagiarism is strictly prohibited. 4. Your file name must be LastName_FirstName_ID.pdf. For example, my file name is Chung_Weiho_003365229.pdf . 5. Due at 11:59 pm, 03/10/2009. No Late Submissions Q1. Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.7 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which it will be worthless. The project is estimated to generate 2,400,000 in annual sales, with costs of 960,000. The tax rate is 35 percent and the required return is 15 percent. What is the project’s NPV? Q2. Hagar Industrial Systems Company is trying to decide between two different conveyor belt systems. System A costs $430,000, has a four-year life, and requires $120,000 in pretax annual operating costs. System B costs $540,000, has a six-year
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This note was uploaded on 04/05/2010 for the course ENGR 111 taught by Professor King during the Winter '09 term at UCLA.

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eng111_HW4 - ENG 111 HW4 Winter 2009 Note: 1. Put your...

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