Future costs that may be incurred by replacing the

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Marginal cost–benefit analysis and the goal of the firm Ken Allen, capital budgeting analyst for Bally Gears, In a proposal. The manager of the automotive division believes that replacing the robotics used on the heavy tru benefits of $560,000 (in today’s dollars) over the next 5 years. The existing robotics would produce benefits o dollars) over that same period. An initial cash investment of $220,000 would be required to install the new eq estimates that the existing robotics can be sold for $70,000. Show how Ken will apply marginal cost–benefit a determine the following:
Future costs that may be incurred by replacing the robots right now (costs caused by change in tec Determine whether there will be additional training necessary with the new robotics Is the depreciation of the new robotics the same as it is on the old ones? What is the new ROI? Possibility of availability of better robotics in a short while, and the energy consumption of the new How important is a switch to the new robotics? Is it worth the time and effort to change?
chnology) w robotics. nc., has been asked to evaluate uck gear line will produce total of $400,000 (also in today’s quipment. The manager analysis techniques to uld recommend the
Question P1-5 b. Division managers are padding cost estimates to show short-term efficiency gains when the costs come in l c. The firm’s chief executive officer has had secret talks with a competitor about the possibility of a merger in Answers a. b. c. d. Identifying agency problems, costs, and resolutions Explain why each of the follow-ing situations is an agency might be handled short of firing the individual(s) involved.

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