A project has an initial cost of $26,000, a discount rate of 11.7 percent, a life...
A project has an initial cost of $26,000, a discount rate of 11.7 percent, a life of 5 years, and an NPV of $11,216. Given this, you know that the project is expected to earn a return:
equal to 11.7 percent of $26,000 plus an additional $11,216.
of $11,216 in total.
equal to 11.7 percent of $37,216 (= $26,000 + 11,216).
of 11.7 percent of $11,216.
of $26,000 minus $11,216.
Homework Answers
NPV = PRESENT VALUE OF CFAT - INVESTMENT
NPV = 37216 - 26000 = 11216, THIS IS WHAT WE EARNED
ANSWER : EXPECTED TO EARN A RETURN OF $11216 IN TOTAL (SECOND OPTION) (THUMBS UP PLEASE)
A project has an initial cost of $26,000, a discount rate of 11.7 percent, a life of 5 years, and an NPV of $11,216. Given this, you know that the project is expected to earn a return:
Correct!
equal to 11.7 percent of $26,000 plus an additional $11,216.
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