Gomez is considering a $245,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of $1. EV of $1. PVA of $1. and EVA of 5) (Use appropriate factor(s) from the tables provided.) Net cash flows (a) Compute the net present value of this investment. (b) Should Gomez accept the investment? Year Complete this question by entering your answers in the tabs below. Year 1 Year 2 Year 3 Year 4 Year 5 Year 1 $80,000 Totals Initial investment Net present value Required A Required B Compute the net present value of this investment. (Round your answers to the nearest whole dollar.) Present Value of 1 at 12% Present Value of Net Cash Flows] Net Cash Flows Year 2 $56,000 $ 80,000 56,000 100,000 160,000 49,000 $ 445,000 $ Year 3 Year 4 $100,000 $160,000 $
Gomez is considering a $245,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of $1. EV of $1. PVA of $1. and EVA of 5) (Use appropriate factor(s) from the tables provided.) Net cash flows (a) Compute the net present value of this investment. (b) Should Gomez accept the investment? Year Complete this question by entering your answers in the tabs below. Year 1 Year 2 Year 3 Year 4 Year 5 Year 1 $80,000 Totals Initial investment Net present value Required A Required B Compute the net present value of this investment. (Round your answers to the nearest whole dollar.) Present Value of 1 at 12% Present Value of Net Cash Flows] Net Cash Flows Year 2 $56,000 $ 80,000 56,000 100,000 160,000 49,000 $ 445,000 $ Year 3 Year 4 $100,000 $160,000 $
Chapter11: Capital Budgeting And Risk
Section: Chapter Questions
Problem 8P
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