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DEVRY BSOP 209 Week 3 Homework Assignment

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<strong>DEVRY</strong> <strong>BSOP</strong> <strong>209</strong> <strong>Week</strong> 3 <strong>Homework</strong><br />

<strong>Assignment</strong><br />

Check this A+ tutorial guideline at<br />

http://www.assignmentclick.com/bsop-<br />

<strong>209</strong>/bsop-<strong>209</strong>-week-3-homeworkassignment<br />

For more classes visit<br />

http://www.assignmentclick.com<br />

S7.17<br />

Markland Manufacturing intends to increase capacity by overcoming a bottleneck<br />

operation by adding new equipment. Two vendors have presented proposals. The<br />

fixed costs for proposal A are $50,000, and for proposal B, $70,000. The variable cost<br />

for A is $12.00, and for B, $10.00. The revenue generated by each unit is $20.00.<br />

a) What is the break-even point in units for proposal A?<br />

b) What is the break-even point in units for proposal B?<br />

S7.18<br />

Using the data in Problem S7.17:


a) What is the break-even point in dollars for proposal A if you add $10,000<br />

installation to the fixed cost?<br />

b) What is the break-even point in dollars for proposal B if you add $10,000<br />

installation to the fixed cost?<br />

S7.30<br />

What is the net present value of an investment that costs $75,000 and has a salvage<br />

value of $45,000? The annual profit from the investment is $15,000 each year for 5<br />

years. The cost of capital at this risk level is 12%.<br />

S7.31<br />

The initial cost of an investment is $65,000 and the cost of capital is 10%. The return<br />

is $16,000 per year for 8 years. What is the net present value?

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