An investment opportunity has cash flows of $5,000, $6,000, and $10,000 in 1, 2, and 3...
An investment opportunity has cash flows of $5,000, $6,000, and $10,000 in 1, 2, and 3 years, respectively. If your relevant interest rate is 15%, what is the maximum amount you would be willing to invest today? DO NOT USE DOLLAR SIGNS OR COMMAS IN YOUR ANSWER. ROUND TO THE NEAREST DOLLAR (e.g., 8000 NOT $8,000).
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An investment opportunity has cash flows of $5,000, $6,000, and
$10,000 in 1, 2, and 3...
3. An investment opportunity has the cash flows which are given below. Years Cash Flow 15000...
3. An investment opportunity has the cash flows which are given below. Years Cash Flow 15000 +12000 +6000 8000 +4000 +12000 2 Use Descartes and Norstrom rules to define the characteristic of internal rate of return for this investment. (10 points) a. According to Descartes rules: According to Norstrom criteria: b. Find external rate of return of the investment opportunity if the external investment rate is %10. (15 points)
Annual cash Inflows from two competing Investment opportunities are given below. Each Investment opportunity will r...
Annual cash Inflows from two competing Investment opportunities are given below. Each Investment opportunity will require the same initial Investment. Year 1 Year 2 Year 3 Year 4 Investment Xinvestment Y $ 5,000 $ 8,000 6 ,000 7,000 7,000 6,000 8,000 5,000 Total $20,000 $26,000 Click here to view Exhibit 11B-1, to determine the appropriate discount factor(s) using tables. Required: Compute the present value of the cash Inflows for each Investment using a 11% discount rate. (Round discount factor(s) to...
Use the following information: Annual cash inflows that will arise from two competing investment projects are...
Use the following information:
Annual cash inflows that will arise from two competing
investment projects are given below:
Investment
Year
A
B
1
$4,000
$16,000
2
$8,000
$12,000
3
$12,000
$8,000
4
$16,000
$4,000
Total
$40,000
$40,000
Each investment project will require the same investment outlay.
The discount rate is 16%
Compute the present value of the cash inflows for Investment A.
(Round to nearest dollar)
Compute the present value of the cash inflows for Investment B.
(Round to nearest...
37) A project with an investment of $12,000 has net cash flows of $6,000, $5,000, 4,000,...
37) A project with an investment of $12,000 has net cash flows of $6,000, $5,000, 4,000, and $3,000 for each of the next four years. Compute the average rate of return for the project? A. 2. 11 B. 1.86 C. 0.45 D. 0.99 E. 0.75
John has an investment opportunity that promises to pay him $12,500 in four years. He could...
John has an investment opportunity that promises to pay him $12,500 in four years. He could earn a 5% annual return investing his money elsewhere. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) What is the maximum amount he would be willing to invest in this opportunity? (Round your final answers to the nearest whole dollar amount.)
A project has cash flows of -$125,500, $60,800, $62,300 and $75,000 for years 0 to 3,...
A project has cash flows of -$125,500, $60,800, $62,300 and $75,000 for years 0 to 3, respectively. The required rate of return is 10.0 percent. What is the profitability index? DO NOT USE DOLLAR SIGNS OR COMMAS IN YOUR ANSWER. ENTER YOUR ANSWER TO TWO DECIMAL PLACES (e.g. 25.75).
If you invest $6,000 today in an account at an annual interest rate of 7% compounded...
If you invest $6,000 today in an account at an annual interest rate of 7% compounded continuously, what would you have in the account at the end of 6 years? DO NOT USE DOLLAR SIGNS OR COMMAS IN YOUR ANSWER. ROUND ANSWER TO THE NEAREST CENT (2 Decimals). LIST THE NUMBER AS A POSITIVE NUMBER.
3. Calculating Discounted Payback An investment project has annual cash inflows of $5,000, $5,500, $6,000, and...
3. Calculating Discounted Payback An investment project has annual cash inflows of $5,000, $5,500, $6,000, and $7,000, and a discount rate of 12 percent. What is the discounted payback period for these cash flows if the initial cost is $8,000? What if the initial cost is $12,000? What if it is $16,000?
You have discovered an investment opportunity that earns an) 3% rate of interest compounded quarterly. Which...
You have discovered an investment opportunity that earns an) 3% rate of interest compounded quarterly. Which of the following amounts is approximately equal to the amount you should deposit today to have $8,000 in five years? Use the formula method. (Do not round any intermediary calculations, and round your final answer to the nearest dollar.) Which of the following statements is true? O A. The higher the discount rate, the higher the present value. OB. If interest is 4% compounded...
You are given three investment alternatives with the following cash flows: Investment of 1 2 3...
You are given three investment alternatives with the following cash flows: Investment of 1 2 3 End of Year $5,000 0 $6,000 2 6,500 0 0 3 0 0 0 4 0 0 12,000 5 18,000 $15,000 0 26,000 0 0 28,000 Calculate the present values given a 8% discount rate. What is the present value of Investment 1? What is the present value of Investment 2? What is the present value of Investment 3? Round to the nearest whole...
3. An investment opportunity has the cash flows which are given below. Years Cash Flow 15000 +12000 +6000 8000 +4000 +12000 2 Use Descartes and Norstrom rules to define the characteristic of internal rate of return for this investment. (10 points) a. According to Descartes rules: According to Norstrom criteria: b. Find external rate of return of the investment opportunity if the external investment rate is %10. (15 points)
Annual cash Inflows from two competing Investment opportunities are given below. Each Investment opportunity will require the same initial Investment. Year 1 Year 2 Year 3 Year 4 Investment Xinvestment Y $ 5,000 $ 8,000 6 ,000 7,000 7,000 6,000 8,000 5,000 Total $20,000 $26,000 Click here to view Exhibit 11B-1, to determine the appropriate discount factor(s) using tables. Required: Compute the present value of the cash Inflows for each Investment using a 11% discount rate. (Round discount factor(s) to...
Use the following information:
Annual cash inflows that will arise from two competing
investment projects are given below:
Investment
Year
A
B
1
$4,000
$16,000
2
$8,000
$12,000
3
$12,000
$8,000
4
$16,000
$4,000
Total
$40,000
$40,000
Each investment project will require the same investment outlay.
The discount rate is 16%
Compute the present value of the cash inflows for Investment A.
(Round to nearest dollar)
Compute the present value of the cash inflows for Investment B.
(Round to nearest...
3. Calculating Discounted Payback An investment project has annual cash inflows of $5,000, $5,500, $6,000, and $7,000, and a discount rate of 12 percent. What is the discounted payback period for these cash flows if the initial cost is $8,000? What if the initial cost is $12,000? What if it is $16,000?
You have discovered an investment opportunity that earns an) 3% rate of interest compounded quarterly. Which of the following amounts is approximately equal to the amount you should deposit today to have $8,000 in five years? Use the formula method. (Do not round any intermediary calculations, and round your final answer to the nearest dollar.) Which of the following statements is true? O A. The higher the discount rate, the higher the present value. OB. If interest is 4% compounded...
You are given three investment alternatives with the following cash flows: Investment of 1 2 3 End of Year $5,000 0 $6,000 2 6,500 0 0 3 0 0 0 4 0 0 12,000 5 18,000 $15,000 0 26,000 0 0 28,000 Calculate the present values given a 8% discount rate. What is the present value of Investment 1? What is the present value of Investment 2? What is the present value of Investment 3? Round to the nearest whole...
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