Elena knows that the initial investment for this business will require $120,000. She expects that the facility and equipment will have a ten-year useful life and no salvage value at the end of this ten-year period. Now she needs your help answering some questions. Should Elena use net income or net of tax cash flows when evaluating whether she should invest in the manufacturing business?

In a fixed-term, level-payment reverse mortgage, sometimes called a reverse annuity mortgage, or ram, a lender agrees to pay the homeowner a monthly payment, or annuity, and expects to be repaid from the homeowner’s equity when he or she sells the home or obtains other financing to pay off the ram. consider a household that owns a $150,000 home free and clear of mortgage debt. the ram lender agrees to a $100,000 ram for 10 years at 6 percent. assume payments are made annually, at the beginning of each year to the homeowner. calculate the annual payment on the ram.