Finance Questions
Finance Questions
Question:
explain issues that can arise in the financial valuation of an international firm?
Question:
7a) Replacing El Poderoso
Questions
- Assume the prof will finance $20,000 dollars1and that interest in compounded monthly.
- What will be the monthly payments be over a three-year amortization plan? What are they over four years?[1]
- What is the net present value in the difference of the finance programs of the Golf and the Matrix?
- Assume the Volkswagen Dealer does not want to change his price: what equivalent price does the Toyota dealer have to offer to make the two cars’ prices equivalent?
- Assume neither dealer lowers their price: what value would the qualitative factors have to be in order to make the two cars’ prices equivalent?
- Question:
Suppose you need $1 million dollars to start your Dream Business. Research ways to get the money for such a business. Compare two (2) sources of financing you might obtain. (e.g., Small Business Administration (SBA), private investors, private loans, personal assets, and / or personal credit cards.) Identify the risks and benefits of your two (2) choices.
Question:
The details of a 4-year investment proposal to replace an old machine are as follows:
Capital cost of a new 4-year machine = $10,000
Salvage value of new machine in year 4 = $1,000
Current salvage value of old machine = $1,000
Current book value of old machine = $0
Extra initial inventory = $3,000 will be fully recovered when the project is finished
Existing warehouse building to install the new machine can be sold for $2,000 after-tax today and is worthless in four years’ time
R & D = $2000 spent in the previous year
Increase in before-tax revenue = $5,000 p.a.
Increase in before-tax operating costs = $1,000 p.a.
Allocated overhead = $800 of the existing overhead expense
Annual depreciation of new machine on straight-line prime cost basis = $2,500
Tax rate = 40%
What should be the Capital Cash Flow in year 4?
what should be the annual Operating Cash Flow in year 3?
what is the Capital Cash Flow in year 0
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