Please correct answer and don't used hand raiting 18Shepherd's Bush Company is considering two investments, both of which cost $44,000. The cash flows are as follows: Use AppengB and Appendix D.YearProject FProject G1$22,000$21,000217,600315,00017,00013,000a. Calculate the payback period for project F and project G.Note: Round the final answers to 2 decimal places.Project FPayback periodyearsyearsProject Gb-1. Calculate the NPV for project F and project G. Assume a cost of capital of 8 percent.Note: Round "PV Factor" to 3 decimal places. Round the intermediate and final answers to the nearest whole dollar.Net present valueProject FProject G$$b-2. Which of the two projects should be chosen based on the NPV method?O Project FO Project G.O Bothc. Should a firm normally have more confidence in answer derived based on NPV method or Payback method?

Step A: Calculate Payback PeriodThe payback period is the time it takes for the cumulative cash…

Answered: 18 Shepherd's Bush Company is…

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

See similar textbooks

Similar questions

The following are the cash flows of two projects: Year O1234 0 Project A $ (340) Project B $ (340) 170 240 170 240 170 240 170 What is the payback period of each project? Note: Round your answers to 1 decimal place. > Answer is complete but not entirely correct. Project A Payback Period 2.0 years B 2.8 years
Vijay
X-treme Vitamin Company is considering two investments, both of which cost $10,000. The cash flows are as follows: Year Project A Project B 1 $ 12,000 $ 10,000 2 8,000 6,000 3 6,000 16,000 Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a-1. Calculate the payback period for Project A and Project B. b-1. Calculate the net present value for Project A and Project B. Assume a cost of capital of 10 percent.
Nikul
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 8 -$ 433,000 -$ 44,000 1 40,000 21,200 2 12,500 3 22,600 4 19,400 66,000 83,000 548,000 The required return on these investments is 14 percent. a. What is the payback period for each project? Note: Do not round Intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. b. What is the NPV for each project? Note: Do not round Intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. c. What is the IRR for each project? Note: Do not round Intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. d. What is the profitability index for each project? Note: Do not round Intermediate calculations and round your answers to 3 decimal places, e.g., 32.161. e. Based on your answers in (a) through (d), which project will you finally choose? a. Project A Project B b. Project A Project B c. Project A Project B d.…
X-treme Vitamin Company is considering two investments, both of which cost $20,000. The cash flows are as follows: Year Project A Project B 1 $ 23,000 $ 20,000 2 10,000 9,000 3 10,000 15,000 Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a-1. Calculate the payback period for Project A and Project B. (Round your answers to 2 decimal places.) project A 0.87 years project B 1 year b-1. Calculate the net present value for Project A and Project B. Assume a cost of capital of 8 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places.)
The following are the cash flows of two projects: Year 0 1 2 3 4 Project A $ (220) 100 100 100 100 Project B $ (220) 120 120 120 What are the internal rates of return on projects A and B? Note: Enter your answers as a percent rounded to 2 decimal places. Project A B IRR % %
Doak Corporation is evaluating a project with the following cash flows: Year 0 1 2 Cash Flow -$ 53,000 16,700 21,900 27,300 20,400 -8,600 The company uses an interest rate of 10 percent on all of its projects. Calculate the MIRR of the project using all three methods. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. Discounting approach Reinvestment approach. Combination approach Sover 17.00 % % %
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$ 428,000 -$ 41,500 1 42,500 20,700 2 3 63,500 80,500 13,000 20,100 4 543,000 16,900 The required return on these investments is 14 percent. a. What is the payback period for each project? Note: Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. b. What is the NPV for each project? Note: Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. c. What is the IRR for each project? Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. d. What is the profitability index for each project? Note: Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161. e. Based on your answers in (a) through (d), which project will you finally choose? a. Project A Project B b. Project A Project B c. Project A Project B d.…
Baghiben
Vijay
Duo Corporation is evaluating a project with the following cash flows: Year 0 Cash Flow -$ 16,600 1 7,700 2 8,900 3 4 5 8,500 7,300 -4,700 The company uses an interest rate of 11 percent on all of its projects. Calculate the MIRR of the project using all three methods. Note: Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16. Discounting approach Reinvestment approach % % Combination approach %

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS