F2 NPV and IRRA project that costs $1,118,638.72 to install will provide annual cashflows of $370,000.00 for each of the next 7 years.a. Calculate the NPV if the discount rate is 29.20%? (Do not roundintermediate calculations. Round your answer to 2 decimalplaces.)NPV$b. Is this project worth pursuing?No○ Yesc. How high can the discount rate be before you would reject theproject (i.e. What is the projects IRR)? (Do not round intermediatecalculations. Round your answer to 2 decimal places.)Discountrate%

To find the IRR, you can use an iterative method, a financial calculator, or software that can solve…

Answered: NPV and IRR A project that costs…

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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1. A project that provides annual cash flows of $1,200 for nine years costs $6,000 today. Is this a good project if the required return is 8 percent? What if it's 24 percent? At what discount rate would you be indifferent between accepting the project and rejecting it? The graph displays the project's NPV profile NPV 1 0 -1 0.1 0.2 NPV Profile 0.3 0.4 Interest Rate
A project that will provide annual cash flows of $3,100 for nine years costs $10,400 today. At what discount rate would you be indifferent between accepting the project and rejecting it? Discount rate _________%
A project that costs $4,000 to install will provide annual cash flows of $1,300 for each of the next 6 years. a. What is NPV if the discount rate is 14%? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. How high can the discount rate be before you would reject the project? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
← (Net present value calculation) Big Steve's, makers of swizzle sticks, is considering the purchase of a new plastic stamping machine This investment requires an initial outlay of $105,000 and will generate net cash inflows of $17,000 per year for 9 years a. What is the project's NPV using a discount rate of 11 percent? Should the project be accepted? Why or why not? b. What is the project's NPV using a discount rate of 16 percent? Should the project be accepted? Why or why not? c. What is this project's internal rate of return? Should the project be accepted? Why or why not?
You would like to invest in the following Project: Year Cash Flow 0 $-55,000 1 30,000 2 37,000 Your boss insists that only projects that return $1.10 in today's dollars for every $1 invested can be accepted. The discount rate is 10%. Based on this criteria, should you accept the Project? Why?
(Discounted payback period) Gio's Restaurants is considering a project with the following expected cash flows: If the project's appropriate discount rate is 12 percent, what is the project's discounted payback period? What is the project's discounted payback period?. years (Round to two decimal places.) B F text pages Financial calculator Data table YEAR 0 PROJECT CASH FLOW 12 3 4 $150 million 90 million 70 million 90 million 100 million (Click on the icon located on the top-right corner of the data table above in order to copy its contents into a spreadsheet.) Print Done MacBook Air - X Clear all 30 e Check answer F9 F10 F11 FIZ
Calculate the net present value of the following project for discount rates of 10,20 and 40 percent. Based on the NPVs you obtain, under which discount rates do you accept this project? Show your calculations. Cash Flows ($) Year 1 -7000 Year 2 4000 Year 3 19,000 NPV formula: NPV=sum_(t=0)^(n)(EATCF)/((1+k)^(t)) dution:-
(Net present value calculation) Big Steve's, makers of swizzle sticks, is considering the purchase of a new plastic stamping machine. This investment requires an initial outlay of $95,000 and will generate net cash inflows of $19,000 per year for 9 years a. What is the project's NPV using a discount rate of11 percent? Should the project be accepted? Why or why not? b. What is the project's NPV using a discount rate of16 percent? Should the project be accepted? Why or why not? c. What is this project's internal rate of return? Should the project be accepted? Why or why not? a If the discount rate is 11 percent, then the project's NPV is $ ? (Round to the nearest dollar.)
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A new project will have an intial cost of $10,000. Cash flows from the project are expected to be $3,000, $3,500, and $4,000 over the next 3 years, respectively. Assuming a discount rate of 8%, what is the project's discounted payback period? Question 4 options: 2.23 2.89 2.75 2.10 It does not pay back on a discounted basis
A new project will have an intial cost of $12,000. Cash flows from the project are expected to be $6,000, $5,000, and $4,000 over the next 3 years, respectively. Assuming a discount rate of 12%, what is the project's PI? Question 6 options: 1.10 1.06 1.12 1.14 1.02

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