Internal rate of return and modified internal rate of return For the project shown in the following table, calculate the internal rate of return (IRR) and modified internal rate of retum (MIRR) If the cost of capital is 13.01%, indicate whether the project is acceptable according to IRR and MIRR. The project's IRR is %. (Round to two decimal places) If the cost of capital is 13.01% According to IRR you should the project. The project's MIRR is % (Round to two decimal places.) According to MIRR you should the project. W reject accept

Internal rate of return and modified internal rate of return For the project shown in the following table, calculate the internal rate of return (IRR) and modified internal rate of retum (MIRR) If the cost of capital is 13.01%, indicate whether the project is acceptable according to IRR and MIRR. The project's IRR is %. (Round to two decimal places) If the cost of capital is 13.01% According to IRR you should the project. The project's MIRR is % (Round to two decimal places.) According to MIRR you should the project. W reject accept

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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The table below shows internal rate of retum for three investment projects A, B and C and there differences. By capital investment, A
For this question you need to attach a file in Excel with your calculations. What do we call the cost of capital at which the two projects have the same NPV? Find this cost of capital for projects X and Y below Project X: CFo= - $3,500; CF1 = $900; CF2 = $1,000; CF3 = $1,200; CF4 = $750; CF5 = $120. Project Y: CFo = -$3,000; CF1 = $700; CF2 = $900, CF3= $1,000; CF4 = $700.
Net present value Using a cost of capital of 15%, calculate the net present value for the project shown in the following table and indicate whether it is acceptable, The net present value (NPV) of the project is $. (Round to the nearest cent.) Is the project acceptable? (Select the best answer below.) O Yes No Data table (Click on the icon here in order to copy the contents of the data table below a spreadsheet.) Initial investment (CF) Year (0) 1 2 3 4 5 6 7 8 9 10 -1,156,000 Cash inflows (CF) $75,000 $140,000 $192,000 $254,000 $313,000 $378,000 $271,000 $97,000 $49,000 $26,000
Internal rate of return and modified internal rate of return For the project shown in the following table,, calculate the internal rate of return (IRR) and modified internal rate of return (MIRR). If the cost of capital is 12.13%, indicate whether the project is acceptable according to IRR and MIRR. The project's IRR is %. (Round to two decimal places.) Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Initial investment (CF) Year (t) 1 2 3 4 5 Print $70,000 Cash inflows (CFt) $15,000 $25,000 $25,000 $15,000 $10,000 Done X
Keane & Co plc is considering two possible investments. The company requires an Accounting Rate of Return of 12% and payback within 2 years. It has a cost of capital of 12%. Forecast sales and production units Year 1 Year 2 Year 3 Year 4 Contribution per unit Fixed cost per year Initial investment Residual (scrap) value Accounting Rate of Return Internal Rate Return Discount factors at 12% are: Year 1 Year 2 Year 3 Year 4 Year 5 0.893 0.797 0.712 0.636 0.567 Project J 60,000 110,000 80,000 50,000 £40 £800,000 £7,600,000 £300,000 9.5% 8% Project K 30,000 24,000 20,000 12,000 £120 £700,000 £5,500,000 £150,000 19% 18%
Se.126.
Q1) What is the Free Cash Flow at the end of the year 2? Q2) How much is the capital gain/loss at the end of the project? Q3) What is the amount of Working capital recovered at the end of the project?
The internal rate of return is defined as the: OOO rate of return a project will generate if the project is financed solely with internal funds. maximum rate of return a firm expects to earn on a project. discount rate that equates the net cash inflows of a project to zero. discount rate that causes the profitability index for a project to equal zero. discount rate which causes the net present value of a project to equal zero.
Solve the following problems. Provide proper solutions. 1. Given the information below and 15 percent cost of capital: OUTFLOW Year1: P800,000 Year2: P800,000 Year3: P800,000 Year4: P800,000 Year5: P800,000 P2,500,000 INFLOWS (a) Compute the net present value. (b) Should the project be accepted? Why? -----
ternal rate of return and modified internal rate of return. Quark Industries has three potential projects, all with an initial cost of $1,900,000. Given the discount rate and the future cash flow of each project in what are the IRRS and MIRRS of the three projects for Quark Industries? Vhat is the IRR for project M? %3D Data Table % (Round to two decimal places.) (Click on the following icon in order to copy its contents into a spreadsheet.) Projoct O $1,000,000 S800,000 $600,000 $400,000 $200 000 15% Project M $500,000 $500.000 Cash Flow Project N Year 1 $600,000 $600.000 S600.000 S600.000 $600.000 11% Year 2 Year 3 $500.000 $500,000 S500,000 Year 4 Year 5 Discount rate 7%
e. Estimate the required net operating working capital (NOWC) for each year and the cash flow due to changes in NOWC. f. Calculate the after-tax salvage cash flow. g. Calculate the project cash flows for each year. Based on these cash flows and the average project cost of capital, what are the project’s NPV, IRR, MIRR, PI, payback, and discounted payback? Do these indicators suggest that the project should be undertaken?
Km. 212.

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