a) What is the break-even point in dollars for proposal A if you add $10,000
installation to the fixed cost?
b) What is the break-even point in dollars for proposal B if you add $10,000
installation to the fixed cost?
S7.30
What is the net present value of an investment that costs $75,000 and has a salvage
value of $45,000? The annual profit from the investment is $15,000 each year for 5
years. The cost of capital at this risk level is 12%.
S7.31
The initial cost of an investment is $65,000 and the cost of capital is 10%. The return
is $16,000 per year for 8 years. What is the net present value?