Sheet1
Andrew MacGillivray Homework Chapters 10-12
P10-1
a.
b.
Initial Investment
Payback Amt.
No. of Periods to Payback
42000
7000
6
Payback Period = 6 years
Yes, the company should accept the project, since the number of years
to payback the initial inv

Sheet1
Andrew MacGillivray
Homework Week 4
FIN 504
P6-1
Since Tom's real return of return is the difference between his
nominal interest rate and his inflation rate, he is looking at a
2.5% rate of interest return on his investment. (5.5% - 3%)
P6-10
a.
b

Sheet1
Andrew MacGillivray Homework Chapters 8 and 9
P8-1
a.
b.
P8-4
a.
b.
c.
d.
P8-14
x
y
20000
55000
1500
6800
21000
55000
0.125 0.1236363636
I would recommend company X because the expected
rate of return is slightly higher, although the market value i

Sheet1
Andrew MacGillivray
Homework Chapters 13-16
P13-5
0=Q * (P-VC) FC
a.
0=Q * (35-20) 500
0=15Q-500
Q=33.3 months
Since the breakeven time is less than the time Paul plans
to own the car, the update would be feasible
b.
P13-22
Debt Ratio
EBIT
100000
2