Describe the development and interpretation of the bathtub curve
What will be an ideal response?
The bathtub curve is a plot of the probability of device failure against time.
From left to right, the curve starts high and asymptotically approaches a low level for some time before returning to its starting level at the end of the device's useful life. The model shows that products are more likely to fail either very early or very late in life.
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Hurdle rates may change if:
A) the cost of borrowing changes. B) the firm's risk profile changes. C) the overall economic environment changes. D) All of the above.
If the appropriate discount rate for this project is 13%, then the net present value (NPV) is closest to ________
Consider a project with the following cash flows: Year Cash Flow 0 -12,000 1 3000 2 3000 3 3000 4 3000 A) $24,000 B) -$1846 C) -$3077 D) -$2154