ON EXCEL The director of capital budgeting for Giant Inc. has identified two mutually exclusive projects,...
, A firm is evaluating the following two mutually exclusive, but quite profitable 2-year projects I and II, with cash flows at t0,1 and 2 as follows: Year t Project I Project II - $10,000 +20,000 +10,000 $10,000 +$40,000 Compute each project's NPV for r=0% and r=10%, where r= discount rate or required rate Based on the cash flow patterns for the two projects and the answer to part a), can we Using the analytical formulation of the intersection of...
Garage, Inc., has identified the following two mutually exclusive projects. a. What is the IRR for each project? b. If the required return is 11 percent, what is the NPV for each project? c. What is the crossover rate between these two projects? Year 0 Year 1 Year 2 Year 3 Year 4 (43,500) 21.400 18,500 13,800 7,600 (43,500) 6,400 14,700 22,800 25,200 Required return 11% Complete the following analysis. Do not hard code values in your calculations. You must...
Clifford Company is choosing between two projects. The larger project has an initial cost of $100,000, annual cash flows of $30,000 for 5 years, and an IRR of 15.24%. The smaller project has an initial cost of $50,000, annual cash flows of $16,000 for 5 years, and an IRR of 16.63%. The projects are equally risky. Which of the following statements is CORRECT? Since the smaller project has the higher IRR, the two projects’ NPV profiles will cross, and the...
As the director of capital budgeting for KU dairy, you are evaluating two mutually exclusive projects with the following net cash flows: Year Project A Cash Flow Project B Cash Flow 0 -100,000 -100,000 1 50,000 10,000 2 40,000 30,000 3 30,000 40,000 4 10,000 60,000 If KU’s cost of capital is 15%, examine which project you would choose?
As the director of capital budgeting for Denver Corporation, you are evaluating two mutually exclusive projects with the following net cash flows. Project X has cash flows of -100,000 in year 0, 50,000 in year 1, 40,000 in year 2, 30,000 in year 3 and 10,000 in year 4. Project Z has cash flows of -100,000 in year 0, 10,000 in year 1, 30,000 in year 2, 40,000 in year 3 and 60,000 in year 4. If Denver's cost of...
Crossover and NPV. Seether, Inc., has the following two mutually exclusive projects available. Year Project R Projects -$45,000 17,000 19,000 21,000 9,000 7,000 -$76,000 20,000 20,000 35,000 30,000 10,000 What is the crossover rate for these two projects? What is the NPV of each project at the crossover rate?
Crossover and NPV. Seether, Inc., has the following two mutually exclusive projects available. Year Project R Project S -$45,000 -$76,000 20,000 20,000 17,000 19,000 35,000 30,000 10,000 21,000 9,000 7,000 O12345 What is the crossover rate for these two projects? What is the NPV of each project at the crossover rate?
please use excel formula, Thank You in advance Garage, Inc., has identified the following two mutually exclusive projects. a. What is the IRR for each project? b. If the required return is 11 percent, what is the NPV for each project? c. What is the crossover rate between these two projects? A 0 Year o Year 1 Year 2 Year 3 Year 4 0 (43,500) 21,400 18,500 13,800 7,600 $ (43,500) 6,400 14,700 22,800 25,200 0 $ 0 Required return...
Consider the following two mutually exclusive projects. What is the IRR for each project? What is the crossover rate between the two projects? What is the NPV for each project at the various interest rates in cells C27 to C32? A $ A Annual cash flows: Year 0 Year 1 Year 2 Year 3 (24,000) 10.620 10,900 10,500 (24,000) 12,100 9,360 10,400 A A + OSS Complete the following analysis. Do not hard code values in your calculations. You must...
answer using excel If the cost of capital is 12%, which project should be chosen? If the cost of capital is 18% which project should be chosen? a) To determine the answer to this above questions you are to calculate the NPV of each project using a required rate of return of 12% and then a required rate of return of 18%. Then construct the NPV profiles for Project A and Project B. (Note: plot the NPVs of both projects...