Let irr be x%
At irr,present value of inflows=present value of outflows.
1050=500/1.0x+500/1.0x^2+500/1.0x^3+500/1.0x^4
Hence x=irr=31.87%(Approx)
Warr Company is considering a project that has the attached cash flows. What is its IRR?...
Warr Company is considering a project that has the attached cash flows. What is its IRR? Year Cash flows 0 - $1,050 2 $450 3 $450 4 $450 $450 A) 23.55% B) 27.36% C) 26.47% D) 25.68% E) 24.65%
Question 14 (5 points) Mansi Inc. is considering a project that has the attached cash flows. What is its regular payback? 1 Year Cash flows 0 - $500 2 $200 3 $500 $150 A) 3.00 years B) 2.50 years C) 2.75 years D) 2.15 years E) 2.30 years
Nichols Inc. is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the cost of capital or negative, in both cases it will be rejected. Year 0 1 2 3 4 5 Cash flows −$1,250 $325 $325 $325 $325 $325 a. 10.92% b. 9.43% c. 11.47% d. 10.40% e. 9.91% Westwood Painting Co. is considering a project that has the following cash flow and cost...
Jackson Company is considering a project that has the following cash flows. What are the project's payback, discounted payback, NPV, IRR, and MIRR? The weighted Average Cost of capital of Jackson Company is 10 percent. Explain, in writing, if the project is accepted and why? Year Cash Flows ($) 0 -950 1 525 2 485 3 445 4 405
Geraldine Consultants, Inc. is considering a project that has the following cash flows: Year Cash Flow 0 -$1,000 1 400 2 300 3 500 4 400 The company's WACC is 10%. What are the project's payback, internal rate of return, and net present value? Select one: a. Payback = 2.6, IRR = 21.22%, NPV = $300. b. Payback = 2.4, IRR = 21.22%, NPV = $260. c. Payback = 2.6, IRR = 24.12%, NPV = $300. d. Payback = 2.4,...
Warnock Inc. is considering a project that has the following cash flow and WACC data. What is the project's NPV? Note that a project's projected NPV can be negative, in which case it will be rejected. VACC: 10.00% Year Cash flows$1,050 500 $400 $300 a. -$39.09 O b. -$40.27 O c. -$39.48 d. -$47.38 O e. -$29.61
Warnock Inc. is considering a project that has the following cash flow and WACC data. What is the project's NPV? Note that a project's projected NPV can be negative, in which case it will be rejected. WACC: 10.00% Year0123Cash flows-$1,050$500$400$300 a. -$29.61 b. -$40.27 c. -$39.09 d. - $39.48 e. -$47.38
Datta Computer Systems is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's projected IRR can be less than the WACC (and even negative), in which case it will be rejected. Year 0 1 2 3 Cash flows -$1,050 $450 $470 $490 a. 12.69% b. 13.98% c. 15.58% d. 18.15% e. 16.07% 7. Is the investment in Question 6 a good investment? Yes. No. It depends on the WACC....
1. Allen Inc., is considering a project with the following cash flows. Year Cash Flows 0 -$32,374 1 $6,334 2 $13,790 3 $12,995 4 $20,673 5 $29,260 The company uses a discount rate of 7 percent on all of its projects. Calculate the profitability index of the project? 2. Elway Corp. is considering a project with the following cash flows. Year Cash Flows 0 -$45,331 1 $15,903 2 $24,490 3 $34,625 4 -$11,486 5 $40,937 The company uses a discount...
The IRR evaluation method assumes that cash flows from the project are reinvested at the same rate equal to the IRR. However, in reality the reinvested cash flows may not necessarily generate a return equal to the IRR. Thus, the modified IRR approach makes a more reasonable assumption other than the project's IRR. Consider the following situation: Celestial Crane Cosmetics is analyzing a project that requires an initial investment of $3,000,000. The project's expected cash flows are: Year Year 1...