You are in the market for a new refrigerator for your company's lounge, and you have narrowed the search down to two models. The energy-efficient model sells for $1,600 and will save you $40 in electricity costs at the end of each of the next five years. The standard model has features similar to the energy-efficient model but provides no future saving in electricity costs. It is priced at only $1,350. Assuming your opportunity cost of funds is 6 percent, which refrigerator should you purchase? (C LO1, LO5, LO7)
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- You are a coffee connoisseur; you can't remember the last time you went one day without a warm cup of Joe. In fact, your normal routine (7 days a week, 52 weeks a year) is to spend $6 for a large, warm beverage. But, this course has you wondering if quitting coffee would provide a nice way to inflate your retirement fund by age 65. So, at 25 years old, you decide to save your $6 for each day of the week and deposit it every Friday (this means you make one $42 deposit each week, 52 weeks per year) into an account. You plan to repeat this deposit every week for the next 40 years, earning 8% compounded weekly in your coffee account. How much will you have in 40 years? |||4. The Quickhammer corporation has proposed a deal where you will outsource the fabrication of the sprocket assembly in your widget production line. Your Average Total Cost to produce the sprocket assembly is $200, but the Quickhammer Corporation says they can do it for $175 per assembly. You produce 18,500 sprocket assemblies per year. The deal would run for the indefinite future (in perpetuity). Your company WACC is 4.5%. What is the value of this deal to you today?You are scheduling production of your popular Rustic Coffee Table. The table requires a top, fourlegs, 1/8 gallon of stain, 1/16 gallon of glue, 2 short braces between the legs and 2 long bracesbetween the legs, and a brass cap that goes on the bottom of each leg. You have 100 gallons ofglue in inventory, but none of the other components. All items except the brass caps, stain, andglue are ordered on a lot-for-lot basis. The caps are purchased in quantities of 1,000, stain and glueby the gallon. Lead time is 1 day for each item. a) Schedule the order releases necessary to produce 640 coffee tables on days 5 and 6, and128 on days 7 and 8. (See Appendix A1.) I need answer in appendix A1 MRP form Please take note of this !!!