Consider the following cash flows. How many different IRRs are there (hint: search between 20% and...
Consider the following cash flows. How many different IRRs are there (hint: search
between
20%
and
70%
)? What would be your decision?
year Cash Flow
0
-504
1
2862
2
-6070
3
5700
4
-2000
Homework Answers
IRR is the internal rate of return generated from the cash flows of the project. A conventional cash flows in a project will have one IRR and as many more IRRs as the number of sign changes.
Here, it will have 3 IRRs.
Add Answer to:
Consider the following cash flows. How many different IRRs are
there (hint: search
between
20%
and...
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20%...
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20% and 70%)? What would be your decision? year Cash Flow -504 2862 2 -6070 5700 4 2000 0 4
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20%...
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20% and 70%)? What would be your decision? year Cash Flow 504 2862 6070 5700 2000 0 3
How many possible IRRs could you find for the following set of cash flows? 0 0...
How many possible IRRs could you find for the following set of cash flows? 0 0 1 2 Time Cash Flow £10,000 $5,350 $4,180 $1,520 $2,000
Compute the sum of the two IRRs 4. The following cash-flow pattern has two IRRs. Use...
Compute the sum of the two IRRs
4. The following cash-flow pattern has two IRRs. Use Excel to draw a graph of the NPV of these cash flows as a function of the discount rate. Then use the IRR function to identify the two IRRs. Would you invest in this project if the opportunity cost were 20%? 4 5 6 7 8 9 10 A Year 0 1 2 3 4 5 B Cash flow -500 600 300 300 200...
Consider Project Theta, its time line of cash flows, and one of the project IRRs: Year....................0.............1............2............IRR...
Consider Project Theta, its time line of cash flows, and one of the project IRRs: Year....................0.............1............2............IRR Cash Flow......($200).....$850....($700)......15% What is the best decision for Project Theta (accept or reject) if the project’s required rate of return is 15% and why? a. Accept the project because the payback is short b. Accept the project because the NPV is greater than zero c. Reject the project because the IRR is less than the required rate of return d. Reject the project because...
Consider Project Theta, its time line of cash flows, and one of the project IRRs: Year...................0..............1...............2...........IRR...
Consider Project Theta, its time line of cash flows, and one of the project IRRs: Year...................0..............1...............2...........IRR Cash Flow.....($200).....$850.......($700).......15% What is the best decision for Project Theta (accept or reject) if the project’s required rate of return is 15% and why? a. Reject the project because the NPV is less than zero b. Accept the project because the IRR is greater than zero c. Accept the project because the NPV is greater than zero d. Accept the project because the payback...
You are choosing between two projects. The cash flows for the projects are given in the...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project Year 1 Year 2 Year 0 - $51 - $102 $26 $20 Year 3 $20 $49 Year 4 $12 $58 $21 $38 a. What are the IRRs of the two projects? b. If your discount rate is 4.7%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
You are choosing between two projects. The cash flows for the projects are given in the...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project Year 0 - $49 - $98 Year 1 $26 $20 Year 2 $20 $39 Year 3 $19 $49 Year 4 $16 $61 a. What are the IRRs of the two projects? b. If your discount rate is 4.7%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
You are choosing between two projects. The cash flows for the projects are given in the...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project A Year 0 - $48 -$101 Year 1 $23 $20 Year 2 $20 $41 Year 3 $21. $50 Year 4 $13 $59 a. What are the IRRs of the two projects? b. If your discount rate is 5.2%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
2. For the cash flows shown below, determine the total equivalent present worth & the equivalent...
2. For the cash flows shown below, determine the total equivalent present worth & the equivalent annual worth in years 1 through 5. The interest rates specified are 10% for the years 1-3 and 12% for years 4 & 5. Draw the cash flow diagram as well. (Hint: Please note the different interest rates specified for different years] (4 + 2 + 2 pts) Year 0 1 2 3 4 5 Cash Flows, S 0 2000 2000 2000 4000 4000
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20% and 70%)? What would be your decision? year Cash Flow -504 2862 2 -6070 5700 4 2000 0 4
3. Consider the following cash flows. How many different IRRs are there (hint: search between 20% and 70%)? What would be your decision? year Cash Flow 504 2862 6070 5700 2000 0 3
How many possible IRRs could you find for the following set of cash flows? 0 0 1 2 Time Cash Flow £10,000 $5,350 $4,180 $1,520 $2,000
Compute the sum of the two IRRs
4. The following cash-flow pattern has two IRRs. Use Excel to draw a graph of the NPV of these cash flows as a function of the discount rate. Then use the IRR function to identify the two IRRs. Would you invest in this project if the opportunity cost were 20%? 4 5 6 7 8 9 10 A Year 0 1 2 3 4 5 B Cash flow -500 600 300 300 200...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project Year 1 Year 2 Year 0 - $51 - $102 $26 $20 Year 3 $20 $49 Year 4 $12 $58 $21 $38 a. What are the IRRs of the two projects? b. If your discount rate is 4.7%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project Year 0 - $49 - $98 Year 1 $26 $20 Year 2 $20 $39 Year 3 $19 $49 Year 4 $16 $61 a. What are the IRRs of the two projects? b. If your discount rate is 4.7%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
You are choosing between two projects. The cash flows for the projects are given in the following table ($ million): Project A Year 0 - $48 -$101 Year 1 $23 $20 Year 2 $20 $41 Year 3 $21. $50 Year 4 $13 $59 a. What are the IRRs of the two projects? b. If your discount rate is 5.2%, what are the NPVs of the two projects? c. Why do IRR and NPV rank the two projects differently? a. What...
2. For the cash flows shown below, determine the total equivalent present worth & the equivalent annual worth in years 1 through 5. The interest rates specified are 10% for the years 1-3 and 12% for years 4 & 5. Draw the cash flow diagram as well. (Hint: Please note the different interest rates specified for different years] (4 + 2 + 2 pts) Year 0 1 2 3 4 5 Cash Flows, S 0 2000 2000 2000 4000 4000
Most questions answered within 3 hours.
-
Imagine you are the owner of a small, entrepreneurial start-up.
You feel stretched to the snapping...
asked 12 minutes ago -
Hi! I need help answering this questions. Please provide an
explanation for the answer as well,...
asked 11 minutes ago -
Explain five reason why incentive plans fail
Human Resource Management
asked 15 minutes ago -
1)
Construct FSM for the following scenarios.
Input: non empty binary sequence
I) output:
Should end...
asked 11 minutes ago -
Suppose that the probability that Sally eats ice cream for
dessert is p, and the probability...
asked 21 minutes ago -
.how important is it to use data modeling when designing
databases
asked 30 minutes ago -
A
child is siitng on a swing (20kg) and the mother applies a force of
45N...
asked 30 minutes ago -
Your university is running a special offer on tuition. This
year's tuition cost is $16,000. Next...
asked 29 minutes ago -
A massless and frictionless spring stretches 4.16 cm from the
relaxed position when a 1.47 N...
asked 34 minutes ago -
The United States nickel contains about 25% nickel metal and 75%
copper metal. Could you use...
asked 55 minutes ago -
what are the debuggers in Java?
import java.text.NumberFormat;
/**
*
* This class represents a circle...
asked 1 hour ago -
the
financial statement that sums up a firm's revenues, costs, and
profit over a period of...
asked 1 hour ago