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- he discount rate is 5%. Your Corporation is considering an investment project that will require an initial investment of $9,400 and will generate the following net cash inflows in each of the three years of the project: Year 1 Year 2 Year 3 Cash inflows.......... $4,000 $2,000 $4,000 Cash outflows $0 $0 $1,500 What is the net present value for this investment projectA pharmaceutical company developed four investment plans. The initial investment and the corresponding annual cash flows of the four investment plans for consecutive 5 years are shown in the following Table Q1. Project Name I II III IV Initial Investment (OMR) 44000 62000 100000 109000 Annual Cash inflow (OMR) 10000 22000 27000 44000 Identify the best project and decide the ranking based on the following profitability methods. a) Average rate of return. b) Payback period. c) Net Present value with discounting rate at 8% d) Benefit to cost ratio with discounting rate at 11% e) Internal rate of return for range of suitable discounting rateABM Enterprise would like to evaluate/analyze an investment proposal. Given the following: Investment amount - 450,000 (2022) Dividends / Revenue stream - 100,000 for the first year and an interval of 5,000 for the succeeding years Discount rate - 14% a. NPV for the perio 2023 through 2029; b. Total NPV using manual computation; c. Total NPV using the Excel function; and d. IRR rate.
- You want to find the NPV of a two-period (two-year) project. The free cash flow (FCF) for the initial period (year 0) is -$100,000, for year 1 it is $50,000, while for the second year it is $80,000. It is financed 60% through a bank loan (which lasts two years) and 40% through the issuance of shares.The interest rate of the loan (for $100,000) is 2% bimonthly overdue.The interest rate of the loan (for $100,000) is 2%, due bimonthly. The tax rate is 35%. For the equity issue, the risk-free rate is estimated to be 3% overdue trimester, and the expected market rate of return is 5% overdue trimester, and the beta to be used for the project is 1.2. The NPV of this project is: For the issuance of shares, the risk-free rate is estimated to be 3% Quarterly Past Due, and the expected market rate of return is 5% Quarterly Past Due, and the beta to be used for the project is 1.2. The NPV of this project is:Rachel the chief financial officer of sunrise fruit snakcs, needed to determine the compnays projected cost of capital for next year, to do so , wshe needed to know the following infomraiont expect a) the proejcted equity level for next year b) the projected intereset rate on next years debt The projected debt level for next year D0 the projected cash balance for next yearAn endowment invests $150,180,000 in WeGrow II, an early-stage venture fund with a 20% incentive fee and a 5% preferred return [hurdle rate]. The fund invests in the following companies (for simplicity, ignore staged financing and management fees; assume instead that all investments occur at the end of their denoted year): Investment (Year Invested) $ 35,030,000 (2) $ 20,030,000 (2) $ 15,030,000 (2) $ 20,030,000 (3) $ 25,030,000 (3) $ 100,030,000 (7) $ 125,030,000 (10) $0 (9) $ 35,030,000 (4) Instead of a 5% preferred rate, assume there is an 8% preferred rate with a 100% catch-up. Required: a. Recalculate the yearly cash flows. b. What is the IRR to the endowment, net of fees? Start-up Name SPE Incorporated NiteID Corporation D-Ton Incorporated IKL Limited H&L Innovations SimLife Technologies Complete this question by entering your answers in the tabs below. Required A Recalculate the yearly cash flows. Note: Negative amounts should be indicated by a minus sign. Year Net Cash Flows 1…
- Simple Investment Allocation Case: This year, 2022 ABM Company selected your team to manage their allotted budget amounting to 10 million pesos for investment diversification portfolio. Your team was assigned to handle the said account. Question: How would you allocate funds?FIN Fund has $1,850 million dollars of assets, $250 million of liabilities, and the management team will receive $50 million in salary and administrative fees in the coming year. If FIN Fund has 250,000,000 shares outstanding what is the NAV of its shares? O A. $6.00 O B. $6.40 O C. $5.80 D. $7.40 OE. $6.20Consider a proposal for a capital investment worth $6,000. Theannual revenues and expenses are $1850 and $500 respectively.Estimated market value of the investment is $1200 at the endof 10 years. Determine how sensitive the decision to invest interms of the capital investment. Draw the cash flow diagram.
- A company manager is faced with an investment proposal of Rp. 100,000,000, - with a period of 4 years and cash inflows every year as follows: Year 1 Rp. 40,000,000 Year 2 Rp. 30,000,000 Year 3 Rp. 30,000,000 Year 4 Rp. 20,000,000 Requested: a. With an interest rate of 12%, with the NPV and PI method, assist the manager in making decisions. Whether the project is accepted or rejected. b. If it is known that the second interest rate is 20% and the cost of capital offered is 17%, calculate the IRR, and make a decision whether to accept or reject the project.A sponsor puts $10m of equity into a project. Over a 20 year timespan, the project returns $28m in distributions to equity. An NPV calculation at a 10% p.a. discount rate shows an NPV of -$2m. What is the most likely IRR? O 0% O 8% O O 10% O 12% O 14%In a case that A firm's cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of each are as follows: Cash Inflows Year A B C 1 $395 - $1,241 2 395 - - 3 395 - - 4 - $1,749 - Each investment requires a $1,000 cash outlay, and investments B and C are mutually exclusive. a. Which investment(s) should the firm make according to the net present values? Why? b. Which investment(s) should the firm make according to the internal rates of return? Why? c. If all funds…