Friday
December 26, 2014

Homework Help: Finance

Posted by John on Friday, April 8, 2011 at 12:29am.

(Break-even analysis) Acquiring more energy-efficient equipment would cost $80,000 now and yield savings of $20,000 in energy costs every year for the next 8 years, after which its salvage value will be 0. The discount rate is 8%.

(1) Based on a before-tax analysis, what is the economic break-even point for the yearly savings?

(2) You now realize that you forgot to consider something in part (1.1). If you acquire new energy-efficient equipment, you can dispose of some of your old equipment for a salvage value of $12,000. Taking this into consideration, redo part (1).

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

Finance - What's the net present value (NPV) of this replacement project? The ...
Business - What is the net present value (NPV) of this replacement project? The ...
Finance - Delta Software is considering a new project whose data are shown below...
CORPORATE FINANCE - You are graduating in September and would like to start your...
Finance - (Inflation) A projectís initial investment is $40,000, and it has a ...
Finance - Cooper construction is considering purchasing new technologically ...
Math - A firm is evaluating two machines. The first costs $250,000 and will ...
Finance - We are considering the introduction of a new product. Currently we are...
Economics - Given the following data, use present worth analysis to find ...
Finance - Dr. David Dunn is adding a new piece of diagnostic equipment to the ...

Search
Members