Consider the following two mutually exclusive projects: Year - 0 (A)-347,000 (B) 49,500 1-A) - 48,000 (B) - 24,300 2 - (A) - 68,000 (B) - 22,300 3 - (A) - 68,000 (B) - 19,800 4-(A) - 443,000 (B) -14,900. What is the payback period for each project? Round final answers to 2 decimal places. What is the discounted payback period for each project? What is the NPV for each project? What is the IRR for each project? What is the profitability index for each project?
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- What is the “cross-over” rate of the following projects? Year Project A Project B 0 -1,400 -800 1 950 600 2 950 600A project has annual cash flows of €-45,000, €35,700, €15,700 and €5,700. Required: What is the payback period for this project? (Round your answer to 2 decimal places (e.g.. 32.16).) Payback period yearsHere are the expected cash flows for three projects: Project Cash Flows (dollars) Year 0 Year 1 Year 2 Year 3 Year 4 A-7,000 +1,500 +1,500 +4,000 0B -3,000 0+3,000+3,000 +4,000 C-7,000+1,500 +1,500 +4,000 + 6,000 a. What is the payback period on each of the projects? b. If you use the payback rule with a cutoff period of 2 years, which projects will you accept? c. If you use a cutoff period of 3 years, which projects will you accept? d-1. If the opportunity cost of capital is 10%, calculate the NPV for projects A, B, and C. Note: Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places. d-2. Which projects have positive NPVs? e. "Payback gives too much weight to cash flows that occur after the cutoff date." True or false?
- b) What is the payback period on each of the following projects? Cash Flow in Dollars Project Time 0 1 A -5,000 +1,000 +1,000 +3,000 -1,000 -5,000 B +1,000 +2,000 +3,000 C +1,000 +1,000 +3,000 +5,000 4 1) Given that you wish to use the payback rule with cut off period of 2 years, which project will you accept? Head 2) If you use a cut off period of 3 years, which projects would you accept? 3) If the opportunity cost of capital is 10%, which projects have positive NPVS? 4) "Payback gives too much weight to cash flows that occur after the cutoff date" – Do you agree with this statement. Please explain in short. lictions: On Ps DELLneed bothEmusk Inc. is evaluating two mutually exclusive projects. The required rate of return on these projects is 8%. Calculate the net present value for project A. (Round to 2 decimals) Year 0 1 2 3 4 5 Project A -15,000,000 2,000,000 3,000,000 5,000,000 5,000,000 6,000,000 Project B -15,000,000 6,000,000 6,000,000 6,000,000 1,000,000 1,000,000
- Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) -$ 15,456 5,225 8,223 13,013 8,705 0 1 234 -$ 276,363 26,400 51,000 57,000 402,000 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A? Payback period b. What is the payback period for Project B? Payback period c. What is the discounted payback period for Project A? Discounted payback periodAnswer the following: 1 What is the payback period on each of the above projects? 2 Given that you wish to use the payback rule with a cutoff period of two years, which projects would you accept? Why? 3 If you use a cutoff period of three years, which projects would you accept? Why?Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$ 491,000 –$ 92,000 1 114,000 52,000 2 134,000 36,000 3 79,000 33,500 4 474,000 28,600 Whichever project you choose, if any, you require a 15% return on your investment. What is the IRR for each project? (Round the final answers to 2 decimal places.) If you apply the IRR criterion, which investment will you choose? Project A Project B What is the profitability index for each project? (Do not round intermediate calculation. Round the final answers to 3 decimal places.) Project A Project B If you apply the profitability index criterion, which investment will you choose? Project A Project B Based on your answers in (a) through (e), which project will you finally choose? Project A Project B
- answer need..1-What is the payback period for each project? Project A Project B years years 2.What is the NPV for each project? Project A Project B 3. What is the IRR for each project? Project A Project B % %Mutually exclusive projects and NPV you have been assigned the task of evaluating two mutually exclusive projects with the following projected cash flows. year. Project A (cash flow) Project B 0 $(102,000) $(102,000) 1 31,000 0 2 31,000 0 3 31,000 0 4 31,000 0 5 31,000 240,000 if the appropriate discount rate on these is 11 percent, which would be chosen and why? the NPV of project A is $