In 2002, a sugarcane molasses-fed 100 million liters per yea…

In 2002, a sugarcane molasses-fed 100 million liters per year, continuous-fermentation ethanol plant was designed in detail and the total purchased equipment costs to construct this plant was estimated to be $12 million. It is now proposed to revive this technology and construct a 100 million gallons per year ethanol plant using the same feedstock. Estimate the total purchased equipment cost for constructing this plant in 2021 (month of May).

Suppose you are interested in an investment that will pay yo…

Suppose you are interested in an investment that will pay you $5,000 in 6 years. Similar investments are offering a return of 8% per year (opportunity cost). a.  What would you be willing to pay for the investment?  Show your work. b.  Would you buy the investment if the market price is $3,500?