NPV Calculate the net present value (NPV) for the following 15-year projects. Comment on the acceptability of each. Assume that the firm has a cost of capital of 9%. A. Initial investment is $1,000,000; cash inflows are $150,000 per year. B. Initial investment is $2,500,000; cash inflows are $320,000 per year. C. Initial investment is $3,000,000; cash inflows are $365,000 per year.

Q: A project cost $1.3 million and will generate cash flows in perpetuity of $230,000. The firm's cost…

A: Given information in question: - Project cost= $1300000 Perpetuity=$230000 Cost of capital=14%

Q: NPV and IRR Benson Designs has prepared the following estimates for a long-term project it is…

A: If NPV of project is positive, Project must be accepted.If NPV of project is negative, Project must…

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Q: NPV and IRR Benson Designs has prepared the following estimates for a long term project it is…

A: Net present value refers to the method of capital budgeting used for estimating the viability of the…

Q: A project cost ​$2.6 million up front and will generate cash flows in perpetuity of ​$210,000.…

A: a) Net present value (NPV) is the contrast between the present value of money inflows over some…

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Q: NPV and IRR   Benson Designs has prepared the following estimates for a​ long-term project it is…

A: NPV is the difference between the sum of the present values of all future cash inflows and the sum…

Q: NPV Calculate the net present value (NPV) for a 15-year project with an initial investment of…

A: In this question, we are required to determine the Net Present Value (NPV).

Q: NPV and IRR Benson Designs has prepared the following estimates for a long-term project it is…

A: Net present value technique is a method to evaluate the profitability of a potential project. A…

Q: Project A has an initial cost of $55,000 expected net cash inflows of $35,000 per year for 3 years,…

A: The payback period refers to the amount of time it takes to recover the cost of an investment.…

Q: NPV and IRR   Benson Designs has prepared the following estimates for a​ long-term project it is…

A: Formula for NPV :  NPV = Initial Investment + C1/(1+r) + C2/(1+r)^2 + C3/(1+r)^3 + ......... +…

Q: A project has an initial outlay of $2,182. It has a single payoff at the end of year 9 of $6,947.…

A: Net present value (NPV) of the project = Present value of single payoff at the end of year 9 -…

Q: A project has an initial cost of $40,000, expected net cash inflows of $9,000 per year for 7 years,…

A: Here, Initial Cost is $40,000 Expected Net Cash Inflows is $9,000 Time Period is 7 years Cost of…

Q: Find internal rate of return of a project with an initial cost of $43,000, expected net cash inflows…

A: We can find the internal rate of return for a stream of constant cash flows using RATE function of…

Q: NPV Calculate the net present value (NPV) for a 15-year project with an initial investment of…

A: Net present value is the technique used in capital budgeting to evaluate the acceptability of the…

Q: The expected profits from a $165,000 investment are $55,000 in Year 1, $80,000 in Year 2, and…

A: Year Cash flows 0 -165000 1 55000 2 80000 3 120000

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A: We need to IRR function in excel to calculate Internal Rate of Return(IRR) Formula is…

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Q: a. Determine the net present value (NPV) for the project b. Determine the internal rate of return…

A: Net present value is determined by deducting the initial investment from the current value of cash…

Q: investment opportunity costing 120,000 is expected to yield net cash flows of 40,000 annually for…

A: Solution a: Computation of NPV  Particulars Period Amount PV factor at 12% Present Value Cash…

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A: Profitability index = present value of future cash flows / net investment

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A: Payback period = Initial Investment / Net annual cashflow

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A: Initial investment = $15,000 Year 1 inflow = $9000 Year 2 inflow = $5000 Year 3 inflow = $4000 WACC…

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Q: For a project that has a net investment of $150,000 and net cash flows of $40,000 for 5 years; Is…

A: Given information: Project’s net investment is $150,000 Net cash flows of $40,000 for 5 years

Q: A project requires an initial investment of $60 million and will then generate the same cash flow…

A: Annual cashinflow= Initial investment / Present value annuity factor,9 years,17%= Initial…

Q: Give typing answer with explanation and conclusion  A six-year project has an initial requirement…

A: The profitability index is a measure used in capital budgeting to determine the potential…