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11. Problem 10-08 (NPVS, IRRS, and MIRRs for Independent Projects) eBook NPVS, IRRS, and MIRRS for Independent Projects Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck is $17,100, and that for the pulley system is $22,430. The firm's cost of capital is 14%. After-tax cash flows, including depreciation, are as follows: IRR NPV MIRR Truck $5,100 5,100 5,100 5,100 7,500 5,100 7,500 Calculate the IRR, the NPV, and the MIRR for each project, and indicate the correct accept/reject decision for each. Do not round intermediate calculations. Round the monetary values to the nearest dollar percentage values to two decimal places. Use a minus sign to enter negative values, if any. $ Value Truck % % Decision -Select- -Select- -Select- $ Value Pulley % % Year 1 2 3 4 Decision -Select- -Select- -Select- Pulley $7,500 7,500 7,500 5

11. Problem 10-08 (NPVS, IRRS, and MIRRs for Independent Projects) eBook NPVS, IRRS, and MIRRS for Independent Projects Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck is $17,100, and that for the pulley system is $22,430. The firm's cost of capital is 14%. After-tax cash flows, including depreciation, are as follows: IRR NPV MIRR Truck $5,100 5,100 5,100 5,100 7,500 5,100 7,500 Calculate the IRR, the NPV, and the MIRR for each project, and indicate the correct accept/reject decision for each. Do not round intermediate calculations. Round the monetary values to the nearest dollar percentage values to two decimal places. Use a minus sign to enter negative values, if any. $ Value Truck % % Decision -Select- -Select- -Select- $ Value Pulley % % Year 1 2 3 4 Decision -Select- -Select- -Select- Pulley $7,500 7,500 7,500 5

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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11. Problem 10-08 (NPVS, IRRS, and MIRRs for Independent Projects) eBook NPVS, IRRS, and MIRRS for Independent Projects Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck is $17,100, and that for the pulley system is $22,430. The firm's cost of capital is 14%. After-tax cash flows, including depreciation, are as follows: Year Truck Pulley $7,500 1 $5,100 2 5,100 7,500 3 5,100 7,500 4 5,100 7,500 5 5,100 7,500 Calculate the IRR, the NPV, and the MIRR for each project, and indicate the correct accept/reject decision for each. Do not round intermediate calculations. Round the monetary values to the nearest dollar and percentage values to two decimal places. Use a minus sign to enter negative values, if any. Pulley IRR NPV MIRR $ Value Truck % % Decision -Select- C -Select- -Select- $ Value % % - Decision -Select- -Select- -Select-C
Transcribed Image Text:11. Problem 10-08 (NPVS, IRRS, and MIRRs for Independent Projects) eBook NPVS, IRRS, and MIRRS for Independent Projects Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year's capital budget. The projects are independent. The cash outlay for the truck is $17,100, and that for the pulley system is $22,430. The firm's cost of capital is 14%. After-tax cash flows, including depreciation, are as follows: Year Truck Pulley $7,500 1 $5,100 2 5,100 7,500 3 5,100 7,500 4 5,100 7,500 5 5,100 7,500 Calculate the IRR, the NPV, and the MIRR for each project, and indicate the correct accept/reject decision for each. Do not round intermediate calculations. Round the monetary values to the nearest dollar and percentage values to two decimal places. Use a minus sign to enter negative values, if any. Pulley IRR NPV MIRR $ Value Truck % % Decision -Select- C -Select- -Select- $ Value % % - Decision -Select- -Select- -Select-C
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