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Problem 8-16 NPV and IRR [LO 3, 4]

Reece Company is presented with the following two mutually exclusive projects. The required return for both projects is 17 percent.

a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

c. Which, if either, of the projects should the company accept?

Reece Company is presented with the following two mutually exclusive projects. The required return for both projects is 13 percent.

a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

c. Which, if either, of the projects should the company accept?

Reece Company is presented with the following two mutually exclusive projects. The required return for both projects is 13 percent.

a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

c. Which, if either, of the projects should the company accept?

Project M

Project N

Both

Neither

Capital budgeting criteria

A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

A. Calculate NPV for each project. Round your answers to the nearest cent. Do not round your intermediate calculations.
Project M $ {C}
Project N $ {C}

Calculate IRR for each project. Round your answers to two decimal places. Do not round your intermediate calculations.
Project M {C}%
Project N {C}%

Calculate MIRR for each project. Round your answers to two decimal places. Do not round your intermediate calculations.
Project M {C}%
Project N {C}%

Calculate payback for each project. Round your answers to two decimal places. Do not round your intermediate calculations.
Project M {C} years
Project N {C} years

Calculate discounted payback for each project. Round your answers to two decimal places. Do not round your intermediate calculations.
Project M {C} years
Project N {C} years

B. Assuming the projects are independent, which one(s) would you recommend?
-Select-Only Project M would be accepted because NPV(M) > NPV(N).Only Project N would be accepted because NPV(N) > NPV(M).Both projects would be accepted since both of their NPV's are positive.Only Project M would be accepted because IRR(M) > IRR(N).Both projects would be rejected since both of their NPV's are negative.Item 11

C. If the projects are mutually exclusive, which would you recommend?
-Select-If the projects are mutually exclusive, the project with the highest positive NPV is chosen. Accept Project N.If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project M.If the projects are mutually exclusive, the project with the highest positive MIRR is chosen. Accept Project M.If the projects are mutually exclusive, the project with the shortest Payback Period is chosen. Accept Project M.If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project N.Item 12

D. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?

A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

0 1 2 3 4 5

Project A -$3,000 $1,000 $1,000 $1,000 $1,000 $1,000

Project B -$9,000 $2,800 $2,800 $2,800 $2,800 $2,800

a. Calculate NPV for each project. Round your answers to the nearest cent.

Project A $

Project B $

Calculate IRR for each project. Round your answers to two decimal places.

Project A %

Project B %

Calculate MIRR for each project. Round your answers to two decimal places.

Project A %

Project B %

Calculate payback for each project. Round your answers to two decimal places.

Project A years

Project B years

Calculate discounted payback for each project. Round your answers to two decimal places.

Project A years

Project B years

b. Assuming the projects are independent, which one or ones would you recommend?

c. If the project are matually exclusive, which would yopu recommend?

d. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?

Capital budgeting criteria

A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

Calculate NPV for each project. Round your answers to the nearest cent.
Project A $ {C}
Project B $ {C}

Calculate IRR for each project. Round your answers to two decimal places.
Project A {C}%
Project B {C}%

Calculate MIRR for each project. Round your answers to two decimal places.
Project A {C}%
Project B {C}%

Calculate payback for each project. Round your answers to two decimal places.
Project A {C} years
Project B {C} years

Calculate discounted payback for each project. Round your answers to two decimal places.
Project A {C} years
Project B {C} years

Assuming the projects are independent, which one or ones would you recommend?
-Select-Only Project B would be accepted because NPV(B) > NPV(A).Both projects would be accepted since both of their NPV's are positive.Only Project A would be accepted because IRR(A) > IRR(B).Both projects would be rejected since both of their NPV's are negative.Only Project A would be accepted because NPV(A) > NPV(B).Item 11

If the projects are mutually exclusive, which would you recommend?
-Select-If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project A.If the projects are mutually exclusive, the project with the highest positive MIRR is chosen. Accept Project A.If the projects are mutually exclusive, the project with the shortest Payback Period is chosen. Accept Project A.If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project B.If the projects are mutually exclusive, the project with the highest positive NPV is chosen. Accept Project B.Item 12

Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?
-Select-The conflict between NPV and IRR is due to the relatively high discount rate.The conflict between NPV and IRR is due to the fact that the cash flows are in the form of an annuity.The conflict between NPV and IRR is due to the difference in the timing of the cash flows.There is no conflict between NPV and IRR.The conflict between NPV and IRR occurs due to the difference in the size of the projects.Item 13

Capital budgeting criteria

A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

0 1 2 3 4 5

Project A -$12,000 $4,000 $4,000 $4,000 $4,000 $4,000
Project B -$36,000 $11,200 $11,200 $11,200 $11,200 $11,200

Calculate NPV for each project. Round your answers to the nearest cent.
Project A $
Project B $

Calculate IRR for each project. Round your answers to two decimal places.
Project A %
Project B %

Calculate MIRR for each project. Round your answers to two decimal places.
Project A %
Project B %

Calculate payback for each project. Round your answers to two decimal places.
Project A years
Project B years

Calculate discounted payback for each project. Round your answers to two decimal places.
Project A years
Project B years

Assuming the projects are independent, which one or ones would you recommend?
-Select-
Only Project B would be accepted because NPV(B) > NPV(A).
Both projects would be accepted since both of their NPV's are positive.
Only Project A would be accepted because IRR(A) > IRR(B).
Both projects would be rejected since both of their NPV's are negative.
Only Project A would be accepted because NPV(A) > NPV(B).
Item 11

If the projects are mutually exclusive, which would you recommend?
-Select-
If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project A.
If the projects are mutually exclusive, the project with the highest positive MIRR is chosen. Accept Project A.
If the projects are mutually exclusive, the project with the shortest Payback Period is chosen. Accept Project A.
If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project B.
If the projects are mutually exclusive, the project with the highest positive NPV is chosen. Accept Project B.
Item 12

Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?
-Select-
The conflict between NPV and IRR is due to the relatively high discount rate.
The conflict between NPV and IRR is due to the fact that the cash flows are in the form of an annuity.
The conflict between NPV and IRR is due to the difference in the timing of the cash flows.
There is no conflict between NPV and IRR.
The conflict between NPV and IRR occurs due to the difference in the size of the projects.
Item 13

A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project A -$3,000 $1,000 $1,000 $1,000 $1,000 $1,000 Project B -$9,000 $2,800 $2,800 $2,800 $2,800 $2,800 a. Calculate NPV for each project. Round your answers to the nearest cent. Project A $ Project B $ Calculate IRR for each project. Round your answers to two decimal places. Project A % Project B % Calculate MIRR for each project. Round your answers to two decimal places. Project A % Project B % Calculate payback for each project. Round your answers to two decimal places. Project A years Project B years Calculate discounted payback for each project. Round your answers to two decimal places. Project A years Project B years b. Assuming the projects are independent, which one or ones would you recommend? -Select-Only Project A would be accepted because NPV(A) > NPV(B).Only Project B would be accepted because NPV(B) > NPV(A).Both projects would be accepted since both of their NPV's are positive.Only Project A would be accepted because IRR(A) > IRR(B).Both projects would be rejected since both of their NPV's are negative. c. If the projects are mutually exclusive, which would you recommend? If the projects are mutually exclusive, the project with the highest positive NPV is chosen. Accept Project B.If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project A.If the projects are mutually exclusive, the project with the highest positive MIRR is chosen. Accept Project A.If the projects are mutually exclusive, the project with the shortest Payback Period is chosen. Accept Project A.If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project B. d. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?

A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows:

Calculate NPV for each project. Round your answers to the nearest cent.
Project A $
Project B $

Calculate IRR for each project. Round your answers to two decimal places.
Project A %
Project B %

Calculate MIRR for each project. Round your answers to two decimal places.
Project A %
Project B %

Calculate payback for each project. Round your answers to two decimal places.
Project A years
Project B years

Calculate discounted payback for each project. Round your answers to two decimal places.
Project A years
Project B years

b. Assuming the projects are independent, which one or ones would you recommend?
-Select-Both projects would be rejected since both of their NPV's are negative.

Only Project A would be accepted because NPV(A) > NPV(B).

Only Project B would be accepted because NPV(B) > NPV(A).

Both projects would be accepted since both of their NPV's are positive.

Only Project A would be accepted because IRR(A) > IRR(B).

c. If the projects are mutually exclusive, which would you recommend?
-Select-If the projects are mutually exclusive, the project with the highest positive NPV is chosen. Accept Project B.

If the projects are mutually exclusive, the project with the highest positive IRR is chosen.Accept Project A.

If the projects are mutually exclusive, the project with the highest positive MIRR is chosen. Accept Project A.

If the projects are mutually exclusive, the project with the shortest Payback Period is chosen.Accept Project A.

If the projects are mutually exclusive, the project with the highest positive IRR is chosen. Accept Project B.

d. Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?
-Select-The conflict between NPV and IRR is due to the difference in the timing of the cash flows.

There is no conflict between NPV and IRR.

The conflict between NPV and IRR occurs due to the difference in the size of the projects.

The conflict between NPV and IRR is due to the relatively high discount rate.

The conflict between NPV and IRR is due to the fact that the cash flows are in the form of an annuity.

Abstract This case deals with the capital budgeting techniques of Net Present Value (i.e. NPV) and Internal Rate of Return (i.e. IRR). In this case, students will compare two mutually exclusive projects using NPV and IRR, and choose the best project. They will learn about NPV and IRR methods and their advantages and disadvantages. Students will also learn the weakness of the IRR method when comparing two or more projects. Finally, they will evaluate the two projects assuming that the projects are independent projects rather than mutually exclusive ones. This is a hands-on experience for students who want to delve into project valuation. Introduction After graduating from an MBA Program on the East Coast, Michael Strahan had started working for a mining company. His company is evaluating two projects: One of them requires a smaller investment, and then will create a big, positive cash flow in the first year; and then smaller cash flows after that. The second project is a relatively bigger project. It will require a larger cash flow at the beginning, and then will bring in a relatively small cash flow in the first year. But, this second project will create much larger cash flows in the years after that. Michael has been given the task of evaluating these two projects and choosing the best one for his company. Initially he thought that this would be an easy task for him. He would just try to accurately predict the cash flows from the two projects and then evaluate them using some of the “capital budgeting techniques” that he had learned when he was at school. He visits Elizabeth, one of his colleagues, in order to clarify some issues that come to his mind. “Liz” he said, “I am tasked with evaluating two projects and then choosing the best one for our company. I am really excited because it seems like this decision will have a big impact on our company’s bottom line. Could you help me a little bit?” Elizabeth has been working for the company for more than five years. She sure wants to help his colleague. She says “Sure, I can help you. Exactly what do you want to learn?” Michael sighs “Elizabeth, when evaluating these two projects, I think I need to use some of the capital budgeting techniques that we had learned at school. For example, we had Net Present Value, Internal Rate of Return, Payback Period, and others. I am not sure which of these methods to use”. Elizabeth responds “I read somewhere that NPV and IRR are the most commonly used methods to evaluate a project. The Payback Period has lots of disadvantages, so you shouldn’t use that one for sure”. Michael responds “I don’t know what the advantages and the disadvantages of each of these methods. I guess, first, I need to get more information about them. But, if I remember correctly, the Payback Period ignores the time value of money, so it is not good”. Elizabeth says “And it also ignores the cash flows that come after the payback period. In otherwords, if there is a very big positive cash flow that is expected to come sometime in the future, the Payback method ignores that. So, it is kind of weak. There are also other weaknesses with that method.” She adds “IRR also has some weaknesses. I don’t remember them, but you need to research. You don’t want to do something wrong here.” Michael responds “I have read on the web that IRR has two main weaknesses. So, I guess I need to learn about those weaknesses”. “Thanks Liz for offering help. I am now starting to work on it. I think I will see you a few times in the coming days!” Elizabeth responds “No problem. I am here for help, 24/7”. NPV and IRR Michael’s boss told him that these are “mutually exclusive projects” (meaning that the company will accept only one of them). Michael thought that going over some of his class notes may refresh his memory. After scrambling through his notes, he noticed that he skipped the lecture where the professor explained capital budgeting techniques. “No problem” he thought. “I can search the web to find some information on these so called “mutually exclusive projects”. Michael has found some explanations for NPV and IRR on the internet. Michael finds a straightforward explanation of Net Present Value: “The difference between the present value of the future cash flows from an investment and the amount of investment. Present value of the expected cash flows is computed by discounting them at the required rate of return”. The same source explains IRR as follows: commonly used as an NPV alternative. Calculations of IRR rely on the same formula as NPV does, except with slight adjustments. IRR calculations assume a neutral NPV (a value of zero) and one instead solves for the discount rate. The discount rate of an investment when NPV is zero is the investment’s IRR, essentially representing the projected rate of growth for that investment. Because IRR is necessarily annual it allows for the simplified comparison of a wide variety of types and lengths of investments. The Decision Michael has requested some help in estimating the The expected cash flows for the two are: Yr. Project 1 Project 2 0 - $20 million -$30 million (Initial cash outlay for each project) 1 + $12 million +$5 million 2 + $8 million +15 million 3 + $5 million +20 million He knows that for similar projects, his company has a required return of 12%, and a cost of capital of 10% so he decides to use the 12% required rate of return in his calculations.

To impress his boss, he wants to do a detailed analysis. He wants to answer all of the following questions:

5. Are both methods (i.e. NPV and IRR) good in these situations? What would you do? According to your opinion, which project is better for this company?

6. Does IRR always choose the same project whether a firm has a high cost of capital or a low cost of capital?

7. How about NPV? Does NPV always choose the same project whether a firm has a high cost of capital or a low cost of capital?

8. Over what range of discount rates should we choose Project A? Project B?

Jane’s Auto Care is considering the purchase of a new tow truck. The garage doesn’t currently have a tow truck, and the $59,960 price tag for a new truck would represent a major expenditure. Jane Austen, owner of the garage, has compiled the estimates shown below in trying to determine whether the tow truck should be purchased.

Jane’s good friend, Rick Ryan, stopped by. He is trying to convince Jane that the tow truck will have other benefits that Jane hasn’t even considered. First, he says, cars that need towing need to be fixed. Thus, when Jane tows them to her facility, her repair revenues will increase. Second, he notes that the tow truck could have a plow mounted on it, thus saving Jane the cost of plowing her parking lot. (Rick will give her a used plow blade for free if Jane will plow Rick's driveway.) Third, he notes that the truck will generate goodwill; people who are rescued by Jane’s tow truck will feel grateful and might be more inclined to use her service station in the future or buy gas there. Fourth, the tow truck will have “Jane’s Auto Care” on its doors, hood, and back tailgate—a form of free advertising wherever the tow truck goes. Rick estimates that, at a minimum, these benefits would be worth the following.

The company’s cost of capital is 9%.

a)calculate the net present value ignoring the additonal benefits described by Rick. Should the tow truck be purchased.

b) Calculate the net present value incorporating the additonal benefits suggested by Rick. Should the tow truck be purchased

c) Suppose rick hs been overly optimistic in his assessement of the value of additional benefits. At minimum how would the additonal benefits have to be worth in order for the project to be accepted.

Jane’s Auto Care is considering the purchase of a new tow truck. The garage doesn’t currently have a tow truck, and the $60,050 price tag for a new truck would represent a major expenditure. Jane Austen, owner of the garage, has compiled the estimates shown below in trying to determine whether the tow truck should be purchased.

Jane’s good friend, Rick Ryan, stopped by. He is trying to convince Jane that the tow truck will have other benefits that Jane hasn’t even considered. First, he says, cars that need towing need to be fixed. Thus, when Jane tows them to her facility, her repair revenues will increase. Second, he notes that the tow truck could have a plow mounted on it, thus saving Jane the cost of plowing her parking lot. (Rick will give her a used plow blade for free if Jane will plow Rick's driveway.) Third, he notes that the truck will generate goodwill; people who are rescued by Jane’s tow truck will feel grateful and might be more inclined to use her service station in the future or buy gas there. Fourth, the tow truck will have “Jane’s Auto Care” on its doors, hood, and back tailgate—a form of free advertising wherever the tow truck goes. Rick estimates that, at a minimum, these benefits would be worth the following.

The company’s cost of capital is 9%.Suppose Rick has been overly optimistic in his assessment of the value of the additional benefits. At a minimum, how much would the additional benefits have to be worth in order for the project to be accepted? (Round answer to 0 decimal places, e.g. 125.)

After ten years as a general auto mechanic in a local garage, Joe decides he is tired of working for others, especially since business is typically slow and he works partially on commission. So, he decides to open his own garage. After estimating the cash flows for his new garage, he finds a large, positive NPV. Which of the following is most likely true about his analysis?

A. The discount rate he used must be too low
B. Unless he can find a true source of value in his new venture, he probably made a mistake in estimating his cash flows
C. He has likely been overly optimistic about the future and has underestimated future cash flows
D. His estimates of initial outlays must be off
E. His analysis is probably correct provided there is adequate competition in the auto repair business

You have put together a set of cash flow forecasts for a project and have found, on your first calculation, that the NPV is positive. You should:
I. Accept the project because you are certain to increase shareholder wealth.
II. Try to identify some source of value in the project.
III. Use scenario or sensitivity analysis to investigate the project in greater detail.
IV. Try to assess the degree of forecasting risk that exists with the project.
A. I and II only B. I, II, and IV only C. I, III, and IV only
D. II, III, and IV only E. II and IV only

Which of the following is/are generally LEAST subject to forecasting risk?
I. Projected sales
II. Initial investment
III. Projected fixed costs
A. I only B. II only C. III only D. I and II only E. I and III only

Which of the following statements is NOT accurate regarding scenario analysis?
A. A positive NPV for a project's worst case scenario means it is likely the project will in fact offer a positive return.
B. The worst case scenario is used to identify the point at which a project's NPV becomes negative.
C. The base case scenario generally represents an average estimate of NPV.
D. If the NPV of the best case scenario is negative then it is likely unnecessary to create base and worst case scenarios.
E. Scenario analysis is likely not as effective as sensitivity analysis for determining which variables have the greatest impact on projected NPVs.

You want to determine how changes in the price of a product affect a project's NPV and IRR. To best determine the impact, you would most likely use ____________.
A. scenario analysis
B. sensitivity analysis
C. base-case analysis
D. simulation analysis
E. multiple-outcome analysis

Which of the following statements about simulation analysis is correct?
A. The method essentially combines aspects of the scenario and sensitivity analysis techniques.
B. An advantage of this approach is that once the results are complete, there is often a clear decision rule to follow.
C. It is costly and likely used as a last resort for the analysis of capital budgeting projects.
D. Powerful computers are making this technique ever more impractical.
E. The probability of occurrence for different cases is most likely very easy to assess.

__________ analysis combines _________ analysis and __________ analysis.
A. Scenario; sensitivity; simulation
B. Sensitivity; simulation; scenario
C. Option; scenario; simulation
D. Simulation; scenario; sensitivity
E. Simulation; sensitivity; option

_________ allows a firm to ask what-if type questions in capital budgeting.
I. Scenario analysis
II. Sensitivity analysis
III. Simulation analysis
IV. Break-even analysis
A. I and II only
B. II and III only
C. I, II, and III only
D. I, II, and IV only
E. I, II, III, and IV

Your company's scientists have developed an exciting new product that is unlike anything presently available to consumers. The NPV of bringing the product to market is positive yet you are uncertain about the sales projections. The best way for you to test the validity of the sales projections is to use:
A. Sensitivity and payback analysis. B. Payback and break-even analysis.
C. Break-even and sensitivity analysis. D. Operating leverage analysis.
E. IRR analysis

Multiple choice question:

QUESTION 8 Astroscope Tours finds that if it were to increase its price by 10 percent, it would have a 6 percent reduction in the NPV of its new 3-Hour Tour. Considering other things to be unchanged, Astroscope's analysis could be described as: Monte Carlo simulation. break-even analysis. sensitivity analysis. variance analysis. 2 points

QUESTION 9 If a firm were interested in knowing the effect of a single input change on the net present value of a project, then the firm would most likely want to perform: a Monte Carlo simulation. a scenario analysis. a sensitivity analysis. a break-even analysis. 2 points

QUESTION 10 Scenario analysis can help a firm to: understand the degree of uncertainty that a different set of project-affecting circumstances may hold. eliminate all of the uncertainty that a different set of project-affecting circumstances may hold. transform a risky project into a risk-free project. understand the degree of certainty that a similar set of project-affecting circumstances may hold.

Astroscope Tours finds that if it were to increase its price by 10 percent, it would have a 6 percent reduction in the NPV of its new 3-Hour Tour. Considering other things to be unchanged, Astroscope's analysis could be described as:

2.5 points

QUESTION 9

If a firm were interested in knowing the effect of a single input change on the net present value of a project, then the firm would most likely want to perform:

2.5 points

QUESTION 10

Scenario analysis can help a firm to:

Les is concerned that his variable cost per unit projection for a project may not be reliable. Which type of analysis will help him determine the effect that an incorrect variable cost estimate will have on the final outcome of the project?

1.) Which one of these is most associated with an IRR of -100 percent?
a) Degree of operating leverage. b) Accounting break-even point. c) Contribution margin. d) Simulation analysis. e) Cash break-even point

2. A decrease in which one of the following will increase the accounting break-even quantity? Assume straight-line depreciation is used and ignore taxes.
a) Sales price per unit. b) Management salaries. c) Variable labor costs per unit. d) Initial fixed asset purchases. e)

3) Which one of the following statements concerning scenario analysis is correct?
a) The pessimistic case scenario determines the maximum loss, in current dollars, that a firm could possibly incur from a given project.
b) Scenario analysis defines the entire range of results that could be realized from a proposed investment project.
c) Scenario analysis determines which variable has the greatest impact on a project's final outcome.
d) Scenario analysis helps managers analyze various outcomes that are possible given reasonable ranges for each of the assumptions.

4) Jill's Jello produces 190,000 units and sells those units for $22 each. The company spends $200,000 on rent and machinery, and $15 per unit in materials and labor.
4a). The marginal revenue for the firm is: $
4b). The marginal cost for the firm is: $
4c). The average cost for the firm is: $ (round answer to nearest cent)
4d). The marginal profit for the firm is: $
4e). The total profit for the firm is $ (don't include any commas)
4f). The rule for profit maximization is that as long as (select: total cost, total profit, marginal profit, total revenue, marginal cost, marginal revenue) is greater than (select: total cost, price, total revenue, average cost, marginal cost) a firm should continue production.

Problem 5-2 Break-even analysis [LO2]

The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $35 and has a variable cost of $22. There are $97,500 in fixed costs involved in the production process.

a. Compute the break-even point in units.

Break-even point units = ____________

b. Find the sales (in units) needed to earn a profit of $262,500. (Round your answer to the nearest whole number.)

Sales quantity needed unitsc = ___________

The Hartnett Corporation manufactures baseball bats with SammySosa’s autograph
stamped on them. Each bat sells for $13 and has a variable cost of$8.
There is $20,000 in fixed costs involved in the productionprocess.

a. Compute the break-even point in units.

Selling price per item= $ 13
Variable cost per bat= $ 8
Contribution margin= 5
Fixed cost…………= 20,000
Breakeven Units=20,000/5= 4,000

b. Find the sales (in units) needed to earn a profit of$15,000

(how do you find the sales in units to earn profits of15,000?)
Do you increase the selling price or decrease the VC?

The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $55 and has a variable cost of $29. There are $40,820 in fixed costs involved in the production process.

a. Compute the break-even point in units. Break-even point units

b. Find the sales (in units) needed to earn a profit of $23,920. Sales quantity needed units

Break-even The Harmon Corporation manufactures baseball bats with Jesse Jones signature stamped on. Each bat sells for $12 and has a variable cost of $7.00. There are $20,000 in fixed cost involved in the production process.

Compute the break-even in units.

Find the sales (in units) needed to earn a profit of $15,000.

Break-even analysis The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $13 and has a variable cost of $8. There are $20,000 in fixed costs involved in the production process.

Compute the break-even point in units

Find the sales (in units) needed to earn a profit of$15,000

The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $35 and has a variable cost of $22. There are $97,500 in fixed costs involved in the production process. a. Compute the break-even point in units. b. Find the sales (in units) needed to earn a profit of $262,500. (Round your answer to the nearest whole number.)

The Partner Corp manufacturers basketball shoes with LeBron James autographed stamped on them. The shoe sell for $135 and has a variable cost of $122.  there are $97,500 in fixed costs involved in the production process. Compute the break-even point in units. Find the sales in units needed to earn a profit of $262,500. 

When methane (CH4) burns, it reacts with oxygen gas to produce carbon dioxide and water. The unbalanced equation for this reaction is CH4(g)+2O2(g)→CO2(g)+2H2O.What mass of carbon dioxide is produced from the complete combustion of 4.50×10−3 g of methane?

What mass of water (in grams) can be obtained from the complete combustion of 50.0 g of methane according to this balanced equation? CH4 (g) + 2O2 (g) → CO2 (g) + 2H2O (g)

1 What would be a likely result of expressing telomerase insomatic cells?

Select one:

a. Lower rates of replication

b. Cancer

c. Premature aging

d. Early termination of replication

e. Immortality of gametes

2. Meselson and Stahl showed that DNA is replicated by a__________ system.

Select one:

a. semidispersive

b. semiconservative

3Which of the following typically only has one origin ofreplication?

Select one:

a. Plants

b. Eukaryotes

c. Linear model of replication

d. Humans

e. Prokaryotes

c. dispersive

d. conservative

e. conservative in prokaryotes and dispersive in eukaryotes

Please explain Meselson and stahl experiment in details. Thanks

9. Compare and contrast mosaic and regulative development. Define autonomous specification and give an experimental example of autonomous development. Be sure to include the hypothesis, the experimental organisms, the experimental design, results and conclusions.

Aseptic Technique and Bacterial Anatomy and Morphology Labreport.

The first experiment Aseptic Technique.

The second experiment is Bacterial Anatomy and Morphology Labreport

In this experiment, you will view the Gram Stain results for twodifferent samples. The purpose of this experiment is for you togain an understanding of how the morphology and arrangement ofbacteria relate to staining techniques.

Introduction?

Purpose Findings?

Procedure?

Observations and Results?

Discussion?

Conclusion?

Describe the Meselson-Stahl experiment. Include their hypotheses, experimental design, results, and conclusions.

Bidirectional microglia article by Szepesi

a. What was the initial hypothesis being tested?

b. What methods were used?

c. What did they find?

d. What were their conclusions?

e. What are the limitations of the study?

f. Do you think the results support the conclusions? Why/whynot?

g. What follow-up experiments would you suggest?

Read: "Global metabolic impacts of recent climate warming" -----> https://www.nature.com/articles/nature09407

1. what is the overarching issue? (usually in paragraph 1)

2. what specific hypotheses and predictions did the authors claim to investigate? (often but not always in last paragraph of intro)

3. did the methods and tests address the stated hypotheses?

4. what was the major finding? (often in the 1st paragr of discussion; sound address their most important hypothesis)

5. how did their data support their conclusions?

6. do their conclusions imply anything about the overarching issue in paragraph 1 of the introduction?

Article: http://www.smithsonianmag.com/science-nature/whats-so-hot-about-chili-peppers-116907465/

What question did the authors ask? Note that there is no explicit hypothesis/prediction. Develop your own hypothesis and prediction based on the information given in the article. Did the authors findings support or refute the hypothesis you developed? Is it clear at this point or is there more work to be done?

Question 1

a) State the hypothesis in your own words and what is the general research question or topic adressesed by the authors

b) Before the experiments what are 2 possible mechansims for DEET reception that the authors could consider

c) Outline why the authors think their research question is significant

www.pnas.org/content/pnas/111/46/16592.full.pdf

Choose the correct answer(s) to 17-22 Please help

Question 17

Who is most responsible for the day-to-day management (likeordering supplies) and upkeep of most biology labs?

Question 18

What is the most important part of a paper?

Question 19

Who is the leader of the lab, obtains most grant funding,determines research priorities, and is ultimately responsible forresearch done in the lab?

Question 20

What section of the paper will authors address potentialcriticisms of their study?

Question 21

In the author’s list of a research publication, who usually didthe most work on the project?

Question 22

If you are concerned about the treatment of people in researchinvolving humans, where should you look for approval by a reviewboard?