A company is organizing a project to build housing units with an estimated investment of one million Million dollars to build (100 houses) The price of the house (20) thousand dollars Payable in unequal installments for (4 years), the first installment is 40% of the price of the house, the second installment is 30%, the third installment is 20%, the fourth installment is 10%, estimated The annual costs are (50) thousand dollars. Calculate the rate of return simple, payback period, and internal rate of return Knowing that the minimum discount rate (8%) and the highest (12%) and whether the project is accepted or rejected.
A company is organizing a project to build housing units with an estimated investment of one million Million dollars to build (100 houses) The price of the house (20) thousand dollars Payable in unequal installments for (4 years), the first installment is 40% of the price of the house, the second installment is 30%, the third installment is 20%, the fourth installment is 10%, estimated The annual costs are (50) thousand dollars. Calculate the rate of return simple, payback period, and internal rate of return Knowing that the minimum discount rate (8%) and the highest (12%) and whether the project is accepted or rejected.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter19: The Basic Tools Of Finance
Section: Chapter Questions
Problem 3CQQ
Question
A company is organizing a project to build
housing units with an estimated investment of one million
Million dollars to build (100 houses) The price of the house (20) thousand dollars
Payable in unequal installments for (4 years), the first installment is 40% of the price of the house, the second installment is 30%, the third installment is 20%, the fourth installment is 10%, estimated
The annual costs are (50) thousand dollars. Calculate the rate of return
simple, payback period, and internal rate of return
Knowing that the minimum discount rate (8%) and the highest (12%) and whether the project is accepted or rejected.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Economics Today and Tomorrow, Student Edition
Economics
ISBN:
9780078747663
Author:
McGraw-Hill
Publisher:
Glencoe/McGraw-Hill School Pub Co
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Economics Today and Tomorrow, Student Edition
Economics
ISBN:
9780078747663
Author:
McGraw-Hill
Publisher:
Glencoe/McGraw-Hill School Pub Co
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning