Mendez Company has identified an investment project with the following cash flows. Year Cash Flow $ 470. 610 735 920 4 a. If the discount rate is 10 percent, what is the present value of these cash flows? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the present value at 18 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the present value at 24 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Present value at 10 percent b. Present value at 18 percent c. Present value at 24 percent 123

Mendez Company has identified an investment project with the following cash flows. Year Cash Flow $ 470. 610 735 920 4 a. If the discount rate is 10 percent, what is the present value of these cash flows? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the present value at 18 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the present value at 24 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Present value at 10 percent b. Present value at 18 percent c. Present value at 24 percent 123

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter7: Valuation Of Stocks And Corporations

Section: Chapter Questions

Problem 23SP

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You are asked to evaluate an investment project with the following cash flows: Year 1 234. 2 4 Cash Flow $800 1,090 1,350 1,475 a. If the discount rate is 7 percent, what is the present value of these cash flows? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the present value at 17 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the present value at 25 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Present value at 7% b. Present value at 17% c. Present value at 25% $ 3,926.98
Q. 1 a. Present value at 12 percent? b. Present value at 15 percent? c. Present value at 21 percent?
1- Information about the investment project is as follows. Discount rate (r) = 20% Year Net Cash Flows (TL) -10.000.000 1 - 6.000.000 - 2.000.000 3 30.000.000 4 40.000.000 a) A) Calculate the net present value of the investment. Please interpret with the reasons whether the investment project will be accepted or not according to your result. b) Calculate the internal rate of return of the project using the adjusted internal rate of return method. Interpret the result you found. Explain why the adjusted internal rate of return method was used for the solution. Show the equation you created. You can reach the result by using the excel function. c) Calculate the profitability index of the investment and interpret your result.
1- Information about the investment project is as follows. Discount rate (r) = 20% Year Net Cash Flows (TL) 0 -10.000.000 one - 6.000.000 2nd - 2,000,000 3 30.000.000 4 40.000.000 a) Calculate the net present value of the investment. Please interpret with the reasons whether the investment project will be accepted or not according to your result. b) Calculate the internal rate of return of the project using the adjusted internal rate of return method. Interpret the result you found. Explain why the adjusted internal rate of return method was used for the solution. Show the equation you created. You can reach the result by using the excel function. c) Calculate the profitability index of the investment and interpret your result
Problem #2: Consider an investment where the cash flows are: - $920.33 at time 1 = 0 (negative since this is your initial investment) S407 at time = 1 in years $222 at time = 2 in years $426 at time = 3 in years (a) Use Excel's "Solver" to find the internal rate of return (IRR) of this investment. Take a screen shot showing Solver open with your entries for the function clearly visible. Paste the screen shot into an application (like Paint), and save it as a (.png) file. Upload your screenshot below. (b) What is the value of IRR found by Solver?
Problem 1 Using Microsoft Excel, create an investment cash-flow diagram that will have a present worth of zero using MARR = 12%. The study period needs to be exactly 9 years and each year should have at least one unique cash-flow that is different from the cash-flows over the other years. Your answer should contain a table showing the cash-flows for each year and a graphical representation of the cash-flows (cash-flow diagram).
Year Cash Flow 0 -1000 1 800 2 1000 3 1300 4 -2200 Begin by plotting how the NPV of this project changes with different discount rates. Note that you'll have to find the NPV of the project first using a discount rate of your choosing. Use a data table to create this plot. Have your discount rates range from 0% to 60% in increments of 2%. Please label your x-axis "Discount Rate" and your y-axis "Net Present Value of Cash Flows". Title your graph "NPV Calculation". There should be no legend on the graph. How many IRRs does this project have? What are they? Perform your IRR calculations in the box on the left.
Complete the following 6 Wk 3 Financial Exercises: Problem Set 1, Part 2 problems: 1. Calculate the net present value (NPV) of the following cash flow stream if the required rate is 12%: Insert your NPV calculation. Year Cash Flow Is this a good project for the business to accept? Explain why or why not. Insert your answer. 2. Calculate the NPV of the following cash flow projections based on a required rate of 10.5%: Insert your NPV calculation. Year Cash Flow Is this a good project for the business to accept? Explain why or why not. Insert your answer. 3. A company needs to decide if it will move forward with 2 new products that it is evaluating. The 2 initiatives have the following cash flow projections: Project A Project B Year Cash Flow Year Cash Flow Based on the risk of each project, the company has a required rate of return of 11% for Project A and 11.5% for Project B. The company has a $1.5 million budget to spend on new projects for the year. Should the company move forward…
H3
Q. 2 Using Microsoft Excel, create an investment cash-flow diagram that will have a present worth of zero using MARR = 12%. The study period needs to be exactly 2 years and each year should have at least one unique cash-flow that is different from the cash-flows over the other years. Your answer should contain a table showing the cash-flows for each year and a graphical representation of the cash-flows (cash-flow diagram).