Consider a project with the following cash flows: CF0=$100 million, CF1=$-60 million, CF2=$-60 million. Should you...
Consider a project with the following cash flows:
CF0=$100 million, CF1=$-60 million, CF2=$-60 million.
Should you accept or reject the project if the discount rate is 12%?
Group of answer choices
Flip a coin
Reject
Accept
Homework Answers
Net present value = $100 million - $60 million/1.12 - $60 million/1.122
Net present value = -$1.40 million
Reject
Add Answer to:
Consider a project with the following cash flows:
CF0=$100 million, CF1=$-60 million, CF2=$-60 million.
Should you...
Given the following: Project A: CF0 = -$23,000; CF1 = $6,000; CF2 = $8,500; CF3 =...
Given the following: Project A: CF0 = -$23,000; CF1 = $6,000; CF2 = $8,500; CF3 = $15,100 Project B: CF0 = -$20,000; CF1 = $4,000; CF2 = $7,550; CF3 = $14,600 What is the crossover rate (r)?
1. You must analyze the cash flows of two projects, S and L. Project S: CF0...
1. You must analyze the cash flows of two projects, S and L. Project S: CF0 = -1500; CF1 = 800; CF2 = 700; CF3 = 100; CF4 = 600 Project L: CF0 = -1500; CF1 = 200; CF2 = 600; CF3 = 900; CF4 = 700 Given a required rate of return of 10%, what is the IRR of the better project? (Note: the better project may not be the one with the higher IRR)
a. Find present value of the following cash flows at 3% rate: CF0 = -1000; CF1...
a. Find present value of the following cash flows at 3% rate: CF0 = -1000; CF1 = 300; CF2 = 560; CF3 = -90; CF4 = 250. b. What is the future value of these cash flows?
CF0 -35578 CF1 7400 CF2 42700 CF3 40400 CF4 33600 CF5 48500 CF6 24300 Investor's Rate...
CF0 -35578 CF1 7400 CF2 42700 CF3 40400 CF4 33600 CF5 48500 CF6 24300 Investor's Rate 10 Given the above cash flows and investor's required rate of return, what is the Net Present Value? Express your answers as XXXX.XX. CF0 -118000 CF1 50,700 CF2 25,700 CF3 4,400 CF4 10,400 CF5 24,400 CF6 51,400 IRR ? Given the above cash flows, what is the internal rate of return? (express your answers as a percent without the % sign e.g. xx.xx )...
1. Consider two projects with the following (after-tax) cash flows. Project A: CF1 50, CF2 55,...
1. Consider two projects with the following (after-tax) cash flows. Project A: CF1 50, CF2 55, CF3 85. Project B: CF1 140. Both projects require an initial investment of 100. Assume the cost of capital for both projects is r 5%. (a) Compute NPV and IRR for project A. (b) Compute NPV and IRR for project B. (c) Assume you replicate project B twice, i.e. reinvest 100 in t 1 and t2. Compute the NPV and IRR of the replicated...
Intro You've estimated the following cash flows (in $ million) for two mutually exclusive projects: Year...
Intro You've estimated the following cash flows (in $ million) for two mutually exclusive projects: Year Project A Project B 0 -28 -43 1 30 45 2 40 50 Attempt 1/5 for 10 pts. Part 1 What is the crossover rate, i.e., the discount rate at which both projects have the same NPV? The crossover rate is the discount rate at which both projects have the same NPV: NPV(A) = NPV(B) ⇔ NPV(A) - NPV(B) = 0 ⇔ NPV(A-B) =...
CF0 -50020 CF1 34100 CF2 45600 CF3 35700 CF4 40400 CF5 47000 CF6 23700 Investor's Rate...
CF0 -50020 CF1 34100 CF2 45600 CF3 35700 CF4 40400 CF5 47000 CF6 23700 Investor's Rate 13 Given the above cash flows and investor's required rate of return, what is the Modified Internal Rate of Return (Financial Manager's Rate of Return)? (Express your answers as XX.XX percent without the %. For example if your calculator says 12.24 then enter that. If you use Excel and your answer in decimal is .1224, enter 12.24)
Problem 3: A potential CB project has the following cash flows: CFO = -$500, CF1 =...
Problem 3: A potential CB project has the following cash flows: CFO = -$500, CF1 = $300, CF2 = $200, CF3 = $150. WACC = 6%. Compute the following: V CPT DPB & NFV CPT (EX) A. Payback Period 3. NPV 86.9610 Accept project 2. IRR 16.4634 76 Accept project.
Given the following: Project A: CF, = -$23,560; CF1 = $6,700; CF2 = $9,200; CF3 =...
Given the following: Project A: CF, = -$23,560; CF1 = $6,700; CF2 = $9,200; CF3 = $15,800 Project B: CF = -$19,860; CF1 = $4,140; CF2 = $8,110; CF3 = $15,160 What is the crossover rate (r)? (Round answer to 2 decimal places, e.g. 25.25%.) Crossover rate %
Company XYZ is considering a project with the following projected cash flows: CF0: -27,139 C01: 9,834...
Company XYZ is considering a project with the following projected cash flows: CF0: -27,139 C01: 9,834 C02: 9,832 C03: 13,857 C04: 1,700 Calculate the Profitability Index (PI) of the project. Assume a WACC (discount rate) of 10.6%. Enter your answer as a number with two decimal places of precision (i.e. 1.23).
Problem 3: A potential CB project has the following cash flows: CFO = -$500, CF1 = $300, CF2 = $200, CF3 = $150. WACC = 6%. Compute the following: V CPT DPB & NFV CPT (EX) A. Payback Period 3. NPV 86.9610 Accept project 2. IRR 16.4634 76 Accept project.
Given the following: Project A: CF, = -$23,560; CF1 = $6,700; CF2 = $9,200; CF3 = $15,800 Project B: CF = -$19,860; CF1 = $4,140; CF2 = $8,110; CF3 = $15,160 What is the crossover rate (r)? (Round answer to 2 decimal places, e.g. 25.25%.) Crossover rate %
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