Cash flows for project M are shown below: year CFM 0 (100) 1 10 2 60 3 80 The project has a cost of capitalof 10%. a. Calculate the payback for project M. [5] b. Calculate the NPV for project M. [5] c.. Acompany is evaluating an investment project with the following forecast cash flows: Year 0 1 2 3 4 Cashflow ($m) (6-5) 2-43-12-11-8 Using discount rates of 15% and 20%, what is the internal rate of return of theinvestment project? (10)

a. Payback PeriodThe payback period represents the time it takes for the project's cumulative cash…

Answered: Cash flows for project M are shown…

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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