Julia sold her business for $550,000 today which she then invests in the following: 25% in...
Julia sold her business for $550,000 today which she then invests in the following:
25% in Stock, for which she receives a 4% dividend each year (so, 4% of the total value of her stock holdings she receives as income)
35% in Bonds, for which she receives a 6% annual coupon payment (every six months - or 3% every six months)
20% in Healthcare Group, which pays out $10,000 in Year 1, growing 4% each year
20% in a Farm, which pays out $40,000 in Year 10.
Over the next 15 years, calculate the NPV and IRR of the combined projects?
Homework Answers
We first chalk out the cash flows and then calculate the NPV and IRR using NPV and IRR function in excel
Assuming discount rate of 5% in NPV
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