Given the following unconventional cash flows, find: Time, t Cash flow, CFt, $m 0 -1 1 2 3 4 5 6.12 -14.9435 18.1973 -11.051265 2.677675 i. The number of IRR's (cite which theorem you use to arrive at your answer) ii. Prove your answer in part i by plotting the NPV profile in the domain of 0% through 50%. To accentuate the peak and trough, you may have to adjust the domain accordingly in plotting the NPV profile. iii. Use the Solver function within Excel to find the discount rate at which the NPV is maximized. Restrict your search between 10% and 25%. Answer: Question No. of IRR's for the given cash flows series (an integer) Discount rate for maximum NPV is at % (2 decimals) List all the IRR's (from small to large, in %) (2 decimals) Answer
Given the following unconventional cash flows, find: Time, t Cash flow, CFt, $m 0 -1 1 2 3 4 5 6.12 -14.9435 18.1973 -11.051265 2.677675 i. The number of IRR's (cite which theorem you use to arrive at your answer) ii. Prove your answer in part i by plotting the NPV profile in the domain of 0% through 50%. To accentuate the peak and trough, you may have to adjust the domain accordingly in plotting the NPV profile. iii. Use the Solver function within Excel to find the discount rate at which the NPV is maximized. Restrict your search between 10% and 25%. Answer: Question No. of IRR's for the given cash flows series (an integer) Discount rate for maximum NPV is at % (2 decimals) List all the IRR's (from small to large, in %) (2 decimals) Answer
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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Transcribed Image Text:Given the following unconventional cash flows, find:
Time, t Cash flow, CFt, $m
-1
0
1
2
3
-14.9435
18.1973
-11.051265
2.677675
i. The number of IRR's (cite which theorem you use to arrive at your answer)
ii. Prove your answer in part i by plotting the NPV profile in the domain of 0% through 50%. To accentuate the peak and
trough, you may have to adjust the domain accordingly in plotting the NPV profile.
4
6.12
5
iii. Use the Solver function within Excel to find the discount rate at which the NPV is maximized. Restrict your search
between 10% and 25%.
Answer:
Question
No. of IRR's for the given cash flows series (an integer)
Discount rate for maximum NPV is at
% (2 decimals)
List all the IRR's (from small to large, in %) (2 decimals)
Answer
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