You Are Evaluating a Project for Your Company

question 119

Multiple Choice

You are evaluating a project for your company. You estimate the sales price to be $25 per unit and sales volume to be 4,000 units in year 1; 7,000 units in year 2; and 1,000 units in year 3. The project has a three-year life. Variable costs amount to $10 per unit and fixed costs are $50,000 per year. The project requires an initial investment of $10,000 in assets that will be depreciated straight-line to zero over the three-year project life. The actual market value of these assets at the end of year 3 is expected to be $1,000. NWC requirements at the beginning of each year will be approximately 10 percent of the projected sales during the coming year. The tax rate is 34 percent and the required return on the project is 10 percent. What change in NWC occurs at the end of year 1?

• A)$1,750
• B)$7,500
• C)$11,550
• D)$17,500

Describe how age influences susceptibility to functional fixedness.

Comprehend the relationship between language and culture as evidenced by linguistic relativity.

Recognize the importance of relevant information in solving numerical and structured problems.

Understand different problem-solving strategies and when to apply them.

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Definitions:

White Americans

Individuals in the United States who identify as having origins in any of the original peoples of Europe, the Middle East, or North Africa.

Asian Americans

Americans of Asian descent, representing a diverse group from East Asia, Southeast Asia, and the Indian subcontinent.

John Stuart Mill

A British philosopher and economist (1806-1873) known for his contributions to liberalism, utilitarianism, and social theory.

Pleasure

A feeling of happiness, enjoyment, or satisfaction derived from an experience deemed positive by an individual.