Chapter 11 Sample Problem and Solution

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K Mc Graw Hill You are asked to evaluate the following two projects for the Norton corporation. Use a discount rate of 13 percent. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Project X (Videotapes of the Weather Report) ($18,000 Investment) Year Cash Flow 1 $ 9,000 2 7,000 8,000 7,600 3 4 Profitability index Project Y (Slow-Motion Replays of Commercials) ($38,000 Investment) Cash Flow $ 19,000 12,000 13,000 15,000 a. Calculate the profitability index for project X. Note: Do not round intermediate calculations and round your answer to 2 decimal places. Year 1 2 3 4 Profitability index b. Calculate the profitability index for project Y. Note: Do not round intermediate calculations and round your answer to 2 decimal places. c. Which project would you select based on the profitability index? O Project X Project Y Project Y

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help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working

MYUSF x|困 My Home CengageNOWv2 |Online teachin X gagenow.com/ilrn/takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inpro... 844 A project has estimated annual net cash flows of $66,600. It is estimated to cost $466,200. Determine the cash payback period. Round the answer to one decimal place. years Chapter 26 TAKE HOME EXAM Content Area

13. I need help with finance home work question asap please What is the profitability index for a project that requires an initial cash outflow in the amount of $5,000,000 and has a NPV of $750,000?

Question Content Area There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $35,000 and is expected to generate the following cash flows:   First Year Second Year Third Year Total Alpha Project $31,500   $22,500     $5,000   $59,000 Beta Project 7,000   23,000     28,000   58,000 (Click here to see present value and future value tables) A. If the discount rate is 12%, compute the NPV of each project. Round your present value factor to three decimal places and final answer to answer to 2 decimal places. Alpha Project $fill in the blank 1 Beta Project $fill in the blank 2 B. Which project should be recommended.   .Please round off anwsers. Thank you

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Question Content Area There are two projects under consideration by the Rainbow factory. Each of the projects will require an initial investment of $36,000 and is expected to generate the following cash flows:   First Year Second Year Third Year Total Alpha Project $32,500   $22,000     $4,500   $59,000 Beta Project 8,000   23,000     28,000   59,000 (Click here to see present value and future value tables) A. If the discount rate is 15%, compute the NPV of each project. Round your present value factor to three decimal places and final answer to answer to 2 decimal places. Alpha Project $fill in the blank 1 Beta Project $fill in the blank 2 B. Which project should be recommended.     .

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i will 5 upvotes urgent A firm wants to sponsor a new engineering lab at a local university. This requires $4.0M to construct the lab, $1.5M to equip it, and $750,000 every 6 years for new equipment. What is the required endowment if the university will earn 8% interest on the funds?

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Task 2A business has two projects to invest in, as follows:Create a new spread sheet, calculate NPV for the following projects at discount rates of 3% and 7%, respectively, by creating a dynamic process. Project 1 Project 2Year    Cash inflows    Cash outflows     Cash inflows     Cash outflows0          0.00                70,000.00             0.00                  70,000.001          24,000.00       13,000.00              25,000.00         15,000.002          22,000.00        1,000.00               25,000.00           03          25,000.00        0                           20,000.00          04          25,000.00        0                          43,000.00           21,000.005          17,500.00        7,500.00               20,000.00           5,000.00 P1: NPV                                                   P2: NPVThen, a) by using a built-in/Excel function, calculate the NPV for each project with discount rates of 3% and 7%, respectively;b) By comparing the NPVs at the rate of…

Assume you are the chief financial officer at Lehman Memorial Hospital. The CEO has asked you to analyze two proposed capital investment Project X and project Y each project requires a net investment outlay of $10,000 and the opportunity cost of capital for each project is 14% the project's expected net cash flows are as following Year Project x Project Y 0 (10,000) (10,000) 1 6,500 3,000 2 3,000 3,000 3 3,000 3,000 4 1,000 3,000 a. Calculate each project’s payback, NPV and IRR. b. Which project is financially acceptable? Explain your answer.

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How much would you invest today in order to receive $30,000 in each of the following? (for further instructions on present value in Excel, see the Suggested Resources in the textbook: https://cnx.org/contents/kg0cimBs@14.13:bDQCmuJO@6/Suggested-Resources) a.  10 years at 9% b. 8 years at 12% c. 14 years at 15% d. 19 years at 18%

6.  Problem 11.06 (NPV)     eBook Problem Walk-Through Your division is considering two projects with the following cash flows (in millions):   0 1 2 3                     Project A -$31 $7 $12 $22 Project B -$19 $13 $6 $5 What are the projects' NPVs assuming the WACC is 5%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A:    $   million Project B:    $   million What are the projects' NPVs assuming the WACC is 10%? Enter your answer in millions. For example, an answer of $10,550,000 should be entered as 10.55. Negative values, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to two decimal places. Project A:  $   million Project B:  $   million What are the projects' NPVs assuming the WACC is…

QUESTION 6 Seaborn Co. has identified an investment project with the following cash flows. Year Cash Flow $950 1,050 1,320 1,200 1 2 3 4 If the discount rate is 10 percent, what is the present value of these cash flows? 3542.76 3578.84 3418.66 4470.00 3847.03 Click Save and Submit to save and submit. Click Save All Answers to save all answers. SEP 28 30 tv ♫ A

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Intro Office Min is considering several risk-free projects: Project Initial cash flow Cash flow in 1 year A -8,100 9,720 -4,000 4,200 -6,500 7,475 B C The risk-free interest rate is 10%. Part 1 What is the NPV of project A? 0+ decimals Submit Part 2 What is the NPV of project B? 0+ decimals Submit Part 3 What is the NPV of project C? 0+ decimals Submit Part 4 Which projects should the company accept? Check all that apply: O Project C Project A Project B Submit

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Calculate the profitability index for the below projects and indicate your order of choices. Project Present Value Investment A $145,000 $95,000 $135,000 $80,000 $175,000 $110,000 Select one: a. B, A and C b. A, C and B c. B, C and A d. C, B and A B с

NPV: Basic Concepts Buena Vision Clinic is considering an investment that requires an outlay of $600,000 and promises a net cash inflow one year from now of $810,000. Assume the cost of capital is 10 percent. The present value tables provided in Exhibit 19B.1 and Exhibit 19B.2 must be used to solve the following problems. Required: 1. Break the $810,000 future cash inflow into the three components shown below. Enter all your answers as positive amounts. a. The return of the original investment $ 600,000 b. The cost of capital $ 60,000 c. The profit earned on the investment $150,000 2. Now, compute the present value of the profit earned on the investment.$136,350 3. Compute the NPV of the investment. When required, round your answer to the nearest dollar.$

NPV: Basic Concepts Buena Vision Clinic is considering an investment that requires an outlay of $600,000 and promises a net cash inflow one year from now of $810,000. Assume the cost of capital is 10 percent. The present value tables provided in Exhibit 19B.1 and Exhibit 19B.2 must be used to solve the following problems. Required: 1. Break the $810,000 future cash inflow into the three components shown below. Enter all your answers as positive amounts. a. The return of the original investment b. The cost of capital c. The profit earned on the investment 2. Now, compute the present value of the profit earned on the investment. $ 136,350 ✓ 600,000 ✓ 60,000 ✓ 150,000 ✓ 3. Compute the NPV of the investment. When required, round your answer to the nearest dollar. $ Compare this with the present value of the profit computed in Requirement 2. What does this tell you about the meaning of NPV? Net present value represents the present value of future profits ✓