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claytonhopkins
10.10.2019 •
Business
An oil and gas producing company owns 42,000 acres of land in a southeastern state. it operates 630 wells which produce 18,000 barrels of oil per year and 1.7 million cubic feet of natural gas per year. the revenue from the oil is $1,800,000 per year and for natural gas the annual revenue is $581,000 per year. what bid should be made to purchase this property if the potential buyer is hoping to make 11% per year on his investment over a period of 9 years?
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Ответ:
The bid amount should be $13,200,264.
Explanation:
An oil and gas producing company owns 42,000 acres of land in a southeastern state.
It operates 630 wells which produce 18,000 barrels of oil per year and 1.7 million cubic feet of natural gas per year.
The revenue from the oil is $1,800,000 per year and for natural gas the annual revenue is $581,000 per year.
Total Annual Revenue
= Revenue from oil + Revenue from gas
= $1,800,000 + $581,000
= $2,381,000
The bid amount should be the present worth of total annual revenue.
Present Worth of total annual revenue
=![Revenue \times\ \frac{( 1 + i )^{n} -1 }{i (1 + i)^{n} }](/tpl/images/0307/7049/d125f.png)
=![$2,381,000\ \times\ \frac{( 1 + 0.11 )^{9} -1 }{0.11 × (1 + 0.11)^{9} }](/tpl/images/0307/7049/6f9a6.png)
=![$2,381,000\ \times\ \frac{( 1.11 )^{9} -1 }{0.11 × (1.11)^{9} }](/tpl/images/0307/7049/186a5.png)
=![$2,381,000\ \times\ \frac{2.5580 - 1 }{0.11 × 2.5580 }](/tpl/images/0307/7049/f0b34.png)
=![$2,381,000\ \times\ \frac{1.5580 }{0.281}](/tpl/images/0307/7049/d46b1.png)
=![$2,381,000\ \times\ 5.544](/tpl/images/0307/7049/ad8cb.png)
= $13,200,264
Ответ: