INet Present ValueA project has estimated annual net cash flows of $6,250 for two years and is estimated to cost $30,000. Assume a minimum acceptable rate of return of 12%. Use the Present Value of an Annuity of $1 at Compound Interest tablebelow.Present Value of an Annuity of $1 at Compound InterestYear6%12%15%20%10.943234567891.8332.6733.4654.2124.9175.5826.2106.8021010%7.3600.9091.7362.4873.1703.7914.3554.8685.3355.7596.1450.8931.6902.4023.0373.6054.1110.8701.6262.2832.8553.3533.7854.1604.4874.7720.8335.0191.5282.1062.5894.5644.9685.3285.650Determine (a) the net present value of the project and (b) the present value index. If required, use the minus sign to indicate a negative net present value.Net present value of the project (round to the nearest dollar)Present value index (rounded to two decimal places)2.9913.3263.6053.8374.0314.192

Net Present value is present value of cash flow minus initial investment.

Answered: A project has estimated annual net cash…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Find the periodic payments PMT necessary to accumulate the given amount in an annuity account. (Assume end-of-period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent.) $30,000 in a fund paying 5% per year, with monthly payments for 5 years, if the fund contains $10,000 at the start PMT = $
Find the present value PV of the annuity account necessary to fund the withdrawal given. (Assume end-of-period withdrawals and compounding at the same intervals as withdrawals. Round your answer to the nearest cent.) $200 per month for 20 years, if the account earns 2% per year
None
Calculate the convexity of a 4-year annuity-immediate with payments of $100, $100, $200, and $300. The annual effective yield rate is 6%. A 11.320 B 12.320 с 13.320 Ꭰ 14.320 E 15.320
A project has estimated annual net cash flows of $11,250 for four years and is estimated to cost $37,500. Assume a minimum acceptable rate of return of 12%. Use Present Value of an Annuity of $1 at Compound Interest table below.
Find the present value of an investment if it is expected to provide annual earnings of $20,000 for 10 years and to have a resale value of $50,000 at the end of that period. Assume a 8% rate and earnings at year end. The present value of 1 at 8% for 10 periods is .46319. The present value of an ordinary annuity at 8% for 10 periods is 6.71008. The future value of 1 at 8% for 10 periods is 2.15892.
A project has estimated annual net cash flows of $147,000 for 4 years and is estimated to cost $475,500. Assume a minimum acceptable rate of return of 10%. Use the Present Value of an Annuity of $1 at Compound Interest table below. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.868 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Determine (1) the net present value of the project and (2) the present value index. If required, use the minus sign to indicate a negative net present value. Net present value of the project (round to the nearest dollar) $fill in the blank 1 Present value index (rounded to two decimal places) fill in the blank 2 Feedback…
Find the periodic payments PMT necessary to accumulate the given amount in an annuity account. (Assume end-of-period deposits and compounding at the same intervals as deposits. Round your answer to the nearest cent.) $90,000 in a fund paying 3% per year, with monthly payments for 10 years, if the fund contains $30,000 at the start
Given the following information, calculate the rate of return. price = $501.88time to maturity = 10 yearsannual payment = $100type = ordinary annuity
Engineering Economics (Annuity) An ordinary annuity paying P1,811 at the end of each year for 15 years, is to be converted to an annuity paying an amount at the beginning of each month for 15 years. Money is worth 10% compounded annually. Determine the Future value of the payment and the amount being paid at the beginning of each month for 15 years? note: include cash flow diagram and complete/readable solution for this problem, this is 100% upvote guaranteed
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