a
Project | ||||
Discount rate | 0.1 | |||
Year | 0 | 1 | 2 | 3 |
Cash flow stream | -29500 | 16900 | 13600 | 8300 |
Discounting factor | 1 | 1.1 | 1.21 | 1.331 |
Discounted cash flows project | -29500 | 15363.64 | 11239.67 | 6235.913 |
NPV = Sum of discounted cash flows | ||||
NPV Project = | 3339.22 | |||
Where | ||||
Discounting factor = | (1 + discount rate)^(Corresponding period in years) | |||
Discounted Cashflow= | Cash flow stream/discounting factor | |||
PI= (NPV+initial inv.)/initial inv. | ||||
=(3339.22+29500)/29500 | ||||
1.113 | ||||
b
Project | ||||
Discount rate | 0.15 | |||
Year | 0 | 1 | 2 | 3 |
Cash flow stream | -29500 | 16900 | 13600 | 8300 |
Discounting factor | 1 | 1.15 | 1.3225 | 1.520875 |
Discounted cash flows project | -29500 | 14695.65 | 10283.55 | 5457.385 |
NPV = Sum of discounted cash flows | ||||
NPV Project = | 936.59 | |||
Where | ||||
Discounting factor = | (1 + discount rate)^(Corresponding period in years) | |||
Discounted Cashflow= | Cash flow stream/discounting factor | |||
PI= (NPV+initial inv.)/initial inv. | ||||
=(936.59+29500)/29500 | ||||
1.032 | ||||
c
Project | ||||
Discount rate | 0.22 | |||
Year | 0 | 1 | 2 | 3 |
Cash flow stream | -29500 | 16900 | 13600 | 8300 |
Discounting factor | 1 | 1.22 | 1.4884 | 1.815848 |
Discounted cash flows project | -29500 | 13852.46 | 9137.329 | 4570.867 |
NPV = Sum of discounted cash flows | ||||
NPV Project = | -1939.35 | |||
Where | ||||
Discounting factor = | (1 + discount rate)^(Corresponding period in years) | |||
Discounted Cashflow= | Cash flow stream/discounting factor | |||
PI= (NPV+initial inv.)/initial inv. | ||||
=(-1939.35+29500)/29500 | ||||
0.934 | ||||
Consider the following cash flows: Year WN - Cash Flow -$29,500 16,900 13,600 8,300 a. What...
Consider the following cash flows: Year O WN - Cash Flow -$29,500 16,900 13,600 8,300 a. What is the profitability index for the above set of cash flows if the relevant discount rate is 10 percent? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b. What is the profitability index if the discount rate is 15 percent? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) c....
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Consider the following cash flows: Year Cash Flow 332,500 13,800 17,900 11,200 WN a. What is the NPV at a discount rate of zero percent? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What is the NPV at a discount rate of 11 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the NPV at a discount rate of 21 percent?...
Consider the following cash flows: Year 0 WN - 0 Cash Flow 33,000 14,900 16,800 12,300 a. What is the NPV at a discount rate of zero percent? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What is the NPV at a discount rate of 12 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the NPV at a discount rate...