Atown’s recreation department is trying to decide how to use a piece of land. one option 2 is to put up basketball courts with an expected life of 5 years. another is to install a swimming pool with an expected life of 20 years. the basketball court would cost $200,000 to construct and yield net benefits of $40,000 at the end of each year, for 5 years. the swimming pool would cost $3 million to construct and yield net benefits of $250,000 at the end of each year, for 20 years. each project is assumed to have zero salvage value at the end of its life. using a real discount rate of 5 percent, which project offers larger net benefits? approach the problem using the roll-over and the equivalent annual net benefit method

University hero is considering expanding operations beyond its healthy sandwiches. jim axelrod, vice president of marketing, would like to add a line of smoothies with a similar health emphasis. each smoothie would include two free health supplements such as vitamins, antioxidants, and protein. jim believes smoothie sales should fill the slow mid-afternoon period. adding the line of smoothies would require purchasing additional freezer space, machinery, and equipment. jim provides the following projections of net sales, net income, and average total assets in support of his proposal. sandwichesonly sandwiches and smoothies net sales $ 750,000 $ 1,350,000 net income 120,000 210,000 average total assets 350,000 750,000 return on assetschoose numerator ÷ choose denominator = return on assets÷ = return on assets÷ = profit margin÷ = profit margin÷ = asset turnover÷ = asset turnover÷ = times