An investment has an installed cost of $580,382. The cash flows over the four-year life of the investment are projected to be $209,584, $253,318, $201,674, and $169,313. a. If the discount rate is zero, what is the NPV? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. b. If the discount rate is infinite, what is the NPV? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. c. At what discount rate is the NPV just equal to zero? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. a. NPV b. NPV c. Discount rate %
An investment has an installed cost of $580,382. The cash flows over the four-year life of the investment are projected to be $209,584, $253,318, $201,674, and $169,313. a. If the discount rate is zero, what is the NPV? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. b. If the discount rate is infinite, what is the NPV? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. c. At what discount rate is the NPV just equal to zero? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. a. NPV b. NPV c. Discount rate %
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
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Vijay
Transcribed Image Text:An investment has an installed cost of $580,382. The cash flows over the four-year life of the investment are projected to be
$209,584, $253,318, $201,674, and $169,313.
a. If the discount rate is zero, what is the NPV?
Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.
b. If the discount rate is infinite, what is the NPV?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer
to the nearest whole number, e.g., 32.
c. At what discount rate is the NPV just equal to zero?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.
a. NPV
b. NPV
c. Discount rate
%
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