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16. Colusa Regional Medical Center expects Alpha Project and Beta Project to generate the following: Alpha Project (in '000s) Givens Years 1 2 3 4 1 Initial investment ($20,000) 2 Net operating cash flows ($10,000) $8,000 $12,000 $15,000 $26,000 Beta Project (in '000s) Givens Years 1 2 3 4 1 Initial investment ($28,000) 2 Net operating cash flows $8,000 $8,000 $8,000 $8,000 $8,000 a. Determine the payback for both projects. b. Determine the IRR. Determine the NPV at a cost of capital of 20 percent. с.

16. Colusa Regional Medical Center expects Alpha Project and Beta Project to generate the following: Alpha Project (in '000s) Givens Years 1 2 3 4 1 Initial investment ($20,000) 2 Net operating cash flows ($10,000) $8,000 $12,000 $15,000 $26,000 Beta Project (in '000s) Givens Years 1 2 3 4 1 Initial investment ($28,000) 2 Net operating cash flows $8,000 $8,000 $8,000 $8,000 $8,000 a. Determine the payback for both projects. b. Determine the IRR. Determine the NPV at a cost of capital of 20 percent. с.

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
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16. Colusa Regional Medical Center expects Alpha Project and Beta Project to generate the following: Alpha Project (in '000s) Givens Years 1 2 3 4 5 1 Initial investment ($20,000) 2 Net operating cash flows ($10,000) $8,000 $12,000 $15,000 $26,000 Beta Project (in '000s) Givens Years 1 4 5 1 Initial investment ($28,000) 2 Net operating cash flows $8,000 $8,000 $8,000 $8,000 $8,000 а. Determine the payback for both projects. b. Determine the IRR. С. Determine the NPV at a cost of capital of 20 percent.
Transcribed Image Text:16. Colusa Regional Medical Center expects Alpha Project and Beta Project to generate the following: Alpha Project (in '000s) Givens Years 1 2 3 4 5 1 Initial investment ($20,000) 2 Net operating cash flows ($10,000) $8,000 $12,000 $15,000 $26,000 Beta Project (in '000s) Givens Years 1 4 5 1 Initial investment ($28,000) 2 Net operating cash flows $8,000 $8,000 $8,000 $8,000 $8,000 а. Determine the payback for both projects. b. Determine the IRR. С. Determine the NPV at a cost of capital of 20 percent.
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