Answered: 5-Calculate the NPV for the following…

5-Calculate the NPV for the following set of cash flows for Project X, assuming a discount rate of 12% TO: -100,000; T1:40,000; T2:30.00

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 16EB: Project Y cost $8,000 and will generate net cash inflows of $1,500 in year one, $2,000 in year two,...

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

5-Calculate the NPV for the following set of cash flows for Project X, assuming a discount rate of 12%:
TO: -100,000; T1:40,000; T2:30,000; T3:25,000; T4:20,000.
A-2,678
B-(9,865)
C-(234)
D-12,675

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6. IRR (S5.3) a. Calculate the net present value of the following project for discount rates of 0, 50, and 100%: Cash Flows ($) C1 Co -6,750 b. What is the IRR of the project? +4,500 C₂ +18,000 Page 141
N2. Account
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Project Y cost $8,000 and will generate net cash inflows of $1,500 in year one, $2,000 in year two, $2,500 in year three, $3,000 in year four and $2,000 in year five. What is the NPV using 8% as the discount rate?
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What is the net present value of a project with the following cash flows if the discount rate is 15 percent? Year 0: Cash Flow 5-48,000, Year 1: Cash flow = $15,600, Year 2: Cash flow = $28,900, Year 3: Cash flow = 515, 200 Seleccione una: A. -$1,618.48 B. $1,035.24 C. S9.593.19 D $2,687.98 E. $1,044.16
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A 291.