Professional Writers
We assemble our team by selectively choosing highly skilled writers, each boasting specialized knowledge in specific subject areas and a robust background in academic writing
Order For Similar Custom Papers & Assignment Help Services
Fill the order form details - writing instructions guides, and get your paper done.
Posted: August 29th, 2022
The Jones Family, Incorporated
THE JONES FAMILY, INCORPORATED Principles of Corporate Finance 6th Edition Richard A. Brealey and Stewart C. Myers The accompanying table summarizes Johnny’s NPV calculation. He assumed Marsha would take 25 100-mile trips per year, saving $200, plus $1. 00 per mile, plus a $40 tip on every trip. Operating costs would be $. 45 per mile. The net savings are $295 per trip and $7375 per year.
These savings increase with inflation at an assumed rate of 4% per year. It seems that Marsha’s horse transporter was a good buy after all: NPV is positive (+ $14,325). MINICASE SOLUTIONS THE JONES FAMILY’S HORSE TRANSPORTER |Year |0 |1 |2 |3 |4 |5 |6 |7 |8 | |1.
Investment (plus ending value in | | | | | | | | | | |year 8) |-35,000 | | | | | | | |+15,000 | |2. Insurancea |-1,200 |-1,200 |-1,200 |-1,200 |-1,200 |-1,200 |-1,200 |-1,200 | | |3.
Net savings vs. rented | | | | | | | | | | |transporterb | |+7,375 |+7,375 |+7,375 |+7,375 |+7,375 |+7,375 |+7,375 |+7,375 | | | | | | | | | | | | |4.
Cash flow |-36,200 |+6,175 |+6,175 |+6,175 |+6,175 |+6,175 |+6,175 |+6,175 |+21,175 | |5. Adjusted for 4% inflationc | | | | | | | | | | | |-36,200 |+6,422 |+6,679 |+6,946 |+7,224 |+7,513 |+7,813 |+8,126 |+28,979 | |6.
Present valued |-36,200 |+5,892 |+5,622 |+5,364 |+5,118 |+4,883 |+4,658 |+4,445 |+14,543 | NPV = + 14,325 a Paid at start of year. b Savings per 100-mile trip: 200 + 100 (1. 00 – . 45) + 40 = $295. For 25 trips per year, annual savings are 295 x 25 = $7375. Here the savings are entered at end of year (or start of the next year). This understates their value: the Jones family would actually begin to save right away. c Savings increase by 4% per year. Year 8 cash inflows from line 4 are multiplied by (1. 04)8. d Line 5 discounted at 9%.
Why choose us
You Want Quality and That’s What We Deliver
Discounted Prices
Our service is committed to delivering the finest writers at the most competitive rates, ensuring that affordability is balanced with uncompromising quality. Our pricing strategy is designed to be both fair and reasonable, standing out favorably against other writing services in the market.
AI & Plagiarism-Free
Rest assured, you'll never receive a product tainted by plagiarism or AI-generated content. Each paper is research-written by human writers, followed by a rigorous scanning process of the final draft before it's delivered to you, ensuring the content is entirely original and maintaining our unwavering commitment to providing plagiarism-free work.
How it works
When you decide to place an order with Nurscola, here is what happens: