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For Step 1 you need to Choose options 1 and 4. For Step 3, Choose option 2 For step 5, Choose option 2 For step 7, Choose option 1

Step 4: Economic worth calculation Case Study Description $6M investment considered by an electric bike manufacturing company to add a new Find (i) PW, (ii) DPBP, (i) IRR based on BTCF production line for its new product, electric skateboards. The company has commissioned an exploratory place the new production line and which type of equipment use. There are three study of where Step 5 Tax rate types of machines to choose from for the company to install on the new assembly line. The machines have zero salvage value alternatives from i Loan, (ii) Common Stocks, (ii) Preferred Stocks, and (iv) Retained Earnings to obtain choose one set of the tax rates from the following table and find the overall tax rate for your the end of 10-year planning horizon. The company must select at least two project Options Federal Tax Rate State Tax Rate support the project. The company is anticipating rapid product penetration and aggressive growth after 896 20% 1 addition of the new production line. The major question for this case study is to find out if the project is economically justified. Part I: Cash Flow Construction Steo 6: After tax calaulation Please follow this step to create the cash flow of the project and obtain its economic worth. construct the After-Tax Cash Flow (ATCF) and then calculate the corresponding (i) PW, () AW, and (ii) IRR for the ATCF. Step 1: Choose the Capital Sources and Calculate WACC Based on the instruction provided to you, choose the appropriate optipns to form the capital for the investment. and the calculate WACC. Step 7: Choose Inflation and calculate ATCE choose the appropriate value for the Inflation rate from the following table and calculate (i) Options Capital Sources Description Interest Rate = 8% , Compounded PW, () ERR and (iii) IRR based on ATCF. Annually 1 Loan Payback Method: Plan 3 Options Inflation Rate Dividend $7, Price $100, Brokerage Fee $1 2 Preferred Stock Common Stock Retained Earning- Dividend $5, Price = $100, Growth Rate 49% 4. 6% Step 2: Calculate MARR Set MARR equal to rounded WACC (Round up WAcc)+3% for your further analysis. Step 3: Choose the type of Machine and Calculate Before Tax Cash Flow (BTCF) Choose one type of Machine from the following table and calculate the BTCF. Options 2 3 No. of Machines 20 20 First Cost $200,000 $250,000 $300,000 $100 Operating Cost/Hr. Hr./Year 1500 Hrs. 1700 Hrs 1800 Hrs Useful Life 10 Years 10 Years 10 Years Depreciation (MACRS) 5 Years 7 Years 7 Years Step 4: Economic worth calculation Case Study Description $6M investment considered by an electric bike manufacturing company to add a new Find (i) PW, (ii) DPBP, (i) IRR based on BTCF production line for its new product, electric skateboards. The company has commissioned an exploratory place the new production line and which type of equipment use. There are three study of where Step 5 Tax rate types of machines to choose from for the company to install on the new assembly line. The machines have zero salvage value alternatives from i Loan, (ii) Common Stocks, (ii) Preferred Stocks, and (iv) Retained Earnings to obtain choose one set of the tax rates from the following table and find the overall tax rate for your the end of 10-year planning horizon. The company must select at least two project Options Federal Tax Rate State Tax Rate support the project. The company is anticipating rapid product penetration and aggressive growth after 896 20% 1 addition of the new production line. The major question for this case study is to find out if the project is economically justified. Part I: Cash Flow Construction Steo 6: After tax calaulation Please follow this step to create the cash flow of the project and obtain its economic worth. construct the After-Tax Cash Flow (ATCF) and then calculate the corresponding (i) PW, () AW, and (ii) IRR for the ATCF. Step 1: Choose the Capital Sources and Calculate WACC Based on the instruction provided to you, choose the appropriate optipns to form the capital for the investment. and the calculate WACC. Step 7: Choose Inflation and calculate ATCE choose the appropriate value for the Inflation rate from the following table and calculate (i) Options Capital Sources Description Interest Rate = 8% , Compounded PW, () ERR and (iii) IRR based on ATCF. Annually 1 Loan Payback Method: Plan 3 Options Inflation Rate Dividend $7, Price $100, Brokerage Fee $1 2 Preferred Stock Common Stock Retained Earning- Dividend $5, Price = $100, Growth Rate 49% 4. 6% Step 2: Calculate MARR Set MARR equal to rounded WACC (Round up WAcc)+3% for your further analysis. Step 3: Choose the type of Machine and Calculate Before Tax Cash Flow (BTCF) Choose one type of Machine from the following table and calculate the BTCF. Options 2 3 No. of Machines 20 20 First Cost $200,000 $250,000 $300,000 $100 Operating Cost/Hr. Hr./Year 1500 Hrs. 1700 Hrs 1800 Hrs Useful Life 10 Years 10 Years 10 Years Depreciation (MACRS) 5 Years 7 Years 7 Years

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