AARON Capital Investments Corporation was offered a business proposal. The details of the proposal are as follows. Determine the following: a. Enumerate all the cash inflows in the problem. Classify the cash inflow if it is in its present value, future value, or annual value. b. Enumerate all the cash outflows in the problem. Classify the cash outflow if it is in its present value, future value, or annual value. c. When the MARR of the project is 10% and you wish to determine the future worth of the project, write down the complete working formula (with substituted values) to solve the problem.
AARON Capital Investments Corporation was offered a business proposal. The details of the proposal are as follows. Determine the following: a. Enumerate all the cash inflows in the problem. Classify the cash inflow if it is in its present value, future value, or annual value. b. Enumerate all the cash outflows in the problem. Classify the cash outflow if it is in its present value, future value, or annual value. c. When the MARR of the project is 10% and you wish to determine the future worth of the project, write down the complete working formula (with substituted values) to solve the problem.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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AARON Capital Investments Corporation was offered a business proposal. The details of the proposal are as follows.
Determine the following:
a. Enumerate all the cash inflows in the problem. Classify the
b. Enumerate all the cash outflows in the problem. Classify the
c. When the MARR of the project is 10% and you wish to determine the future worth of the project, write down the complete working formula (with substituted values) to solve the problem.
Transcribed Image Text:Proposal
Investment cost Php 3,000,000
Expected life
Market (salvage) value
8 years
-Php 125,000a
Annual receipts Php 1,500,000
Annual expenses Php 1,000,000
a A negative market value means that there is a net cost to dispose of an asset.
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