5-2 Journal Budgeting

A investment opportunity requires an investment today of $48.91 and then in five years, will generate a revenue flow of $24 with prob. 0.5 and $84 with prob. 0.5. What is the internal rate of return for this project? 2% 4% 6% 8%

Find the external rate of return (ERR) for the following project when the external reinvestment rate is $ = 10% (equal to the MARR). Is this an acceptable project?

1. Assuming monetary benefits of a construction project at $50,000 per year during year 1, 2, 3 and 5 (not year 4), one-time costs (initial investment) of $15,000, recurring costs of $35,000 per year (every year), a discount rate of 10 per cent, and a 5-year time horizon, calculate the net present value (NPV) of an information system's costs and benefits. Calculate the overall return on investment (ROI) of the project. During which year does break-even occur?.   Use the NPV template provided (modify to suit your answer) and clearly display the NPV, ROI, and year in which payback occurs.   Write a paragraph explaining whether you would recommend investing in this project based on your financial analysis. Explain your answer referring to the NPV, ROI and payback for this project.   Discount Rate (10%) Year 0 - 1.0000 Year 1 - .9091 Year 2 - .8264 Year 3 - .7513 Year 4 - .6830 Year 5 - .6209

es Lopez Company is considering three alternative investment projects below: Project 1 5.2 years $ 26,700 Project 2 5.7 Years $ 33,700 14.2% 13.1% Payback period Net present value Internal rate of return a. Payback period b. Net present value c. Internal rate of return. Which project is preferred if management makes its decision based on (a) payback period, (b) net present value, and (c) internal rate of return? Preferred Investment Project 3 4.9 Years Reason $19,700 12.5%

Payback ​period, NPV,​ PI, and IRR calculations​) You are considering a project with an initial cash outlay of $80,000 and expected free cash flows of ​$22,000at the end of each year for 5 years. The required rate of return for this project is 7 percent.   a. What is the​ project's payback​ period? b. What is the​ project's NPV​? c. What is the​ project's PI​? d. What is the​ project's IRR​?

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1. A project manager is using the payback method to make the final decision on which project to undertake. The company has a 9% required rate of return and expects a 5% rate of inflation for the following five years. i. ii. What is the non-discounted payback of a project that has cash flows as shown in the table? What is the rate of return? (use equation given in class) Cash Outflow Cash inflow Net Flow Year 10 $500,000 0 1 12. * 0 $75,000 & $50,000 $150,000 3 $200,000 $350,000 4 0 $150,000 5 0 $750,000

1.Assuming you are facing with making a decision on a large capital investment proposal. the capital investment amount is $ Estimated the study period is years .The annual revenue at the end of each year is $ and the estimated annual year-end expense is $ starting in year Assuming a market value at the end year is $ and the benchmark rate is 10%, please answer the following questions: 1.Please design this investment project to fill the proper number in blank space to let the project is feasible in economics( 2.To give the cash flow chart of the project(

Problem #6 - Capital Budgeting Techniques a) If a project costs $74,000 and will earn $24,000 per year for the next four years, and has a discount rate of 5%, what is the: Final Assessment: Outline and Rubric Fundamentals of Finance Final Assessment: Outline and Rubric 1) Payback period 2) IRR 2

I need help finding the Profitability index for each project (D) using Excel

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