1
Project | |||||||||
Discount rate | 0.08 | ||||||||
Year | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |
Cash flow stream | -7700 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 |
Discounting factor | 1 | 1.08 | 1.1664 | 1.259712 | 1.360489 | 1.469328 | 1.586874 | 1.713824 | 1.85093 |
Discounted cash flows project | -7700 | 1787.037 | 1654.664 | 1532.096 | 1418.6076 | 1313.526 | 1216.227 | 1126.136 | 1042.719 |
NPV = Sum of discounted cash flows | |||||||||
NPV Project = | 3391.01 | ||||||||
Where | |||||||||
Discounting factor = | (1 + discount rate)^(Corresponding period in years) | ||||||||
Discounted Cashflow= | Cash flow stream/discounting factor | ||||||||
2
Project | |||||||||
Discount rate | 0.24 | ||||||||
Year | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |
Cash flow stream | -7700 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 |
Discounting factor | 1 | 1.24 | 1.5376 | 1.906624 | 2.3642138 | 2.931625 | 3.635215 | 4.507667 | 5.589507 |
Discounted cash flows project | -7700 | 1556.452 | 1255.203 | 1012.26 | 816.33904 | 658.3379 | 530.9177 | 428.1594 | 345.2899 |
NPV = Sum of discounted cash flows | |||||||||
NPV Project = | -1097.04 | ||||||||
Where | |||||||||
Discounting factor = | (1 + discount rate)^(Corresponding period in years) | ||||||||
Discounted Cashflow= | Cash flow stream/discounting factor | ||||||||
3
Project | |||||||||
IRR is the rate at which NPV =0 | |||||||||
IRR | 0.187085395 | ||||||||
Year | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |
Cash flow stream | -7700 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 | 1930 |
Discounting factor | 1 | 1.187085 | 1.409172 | 1.672807 | 1.985765 | 2.357273 | 2.798284 | 3.321802 | 3.943263 |
Discounted cash flows project | -7700 | 1625.831 | 1369.599 | 1153.749 | 971.91763 | 818.7428 | 689.7084 | 581.01 | 489.4424 |
NPV = Sum of discounted cash flows | |||||||||
NPV Project = | 0.000162736 | ||||||||
Where | |||||||||
Discounting factor = | (1 + IRR)^(Corresponding period in years) | ||||||||
Discounted Cashflow= | Cash flow stream/discounting factor | ||||||||
IRR= | 18.71% | ||||||||
6. walx 4.00 points hat provides anush os 1 3cs 5770 oday Requirement 1: t, what is the NPV of the p calculations. Roun...
A project that provides annual cash flows of $2,650 for nine years costs $10,900 today. At a required return of 8 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV At a required return of 24 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2...
A project that provides annual cash flows of $2,620 for eight years costs $9,430 today. a. At a required return of 8 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 24 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to...
7 A project that provides annual cash flows of $2,620 for eight years costs $9,430 today a. At a required return of 8 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 24 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer...
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A project that will provde annual cash flows of $2,550 for nine years costs $10,500 today. a. At a required return of 11 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 27 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer...
A project that will provde annual cash flows of $3,000 for nine years costs $10,000 today. a. At a required return of 10 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 28 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer...
A project that will provde annual cash flows of $2,750 for nine years costs $9,000 today. a. At a required return of 10 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 29 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer...
newconnect.mheducation.com Cash Flow - Part 2 Chapter 5 - DCF & Interest Rates - Part 3 Chapter 8 PV & Investment Criteria i Saved A project that will provde annual cash flows of $2,350 for nine years costs $9,700 today, a. At a required return of 12 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g. 32.16.) b. At a required return of 28 percent, what is...
Problem 8-10 NPV versus IRR [LO 3, 4) Romboski, LLC, has identified the following two mutually exclusive projects: Year O 1 Cash Flow (A) Cash Flow (B) -$ 63,000 $63,000 39,000 25,700 33,000 29,700 22,500 35,000 14,600 24,700 Requirement 1: (a) What is the IRR for each of these projects? (Do not round intermediate calculations. Enter your answer as a percentage roundedto 2 decimal places (e.g., 32.16).) Internal rate of return Project A Project B (b) if you apply the...