Problem 12-14 (Algo) Net present value method [LO12-4] Aerospace Dynamics will invest $140,000 in a project that will produce the following cash flows. The cost of capital is 11 percent. (Note that the fourth year's cash flow is negative.) Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 2 3 4 5 Cash Flow $ 46,000 56,000 48,000 (56,000) 103,000 a. What is the net present value of the project? Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places. Net present value
Problem 12-14 (Algo) Net present value method [LO12-4] Aerospace Dynamics will invest $140,000 in a project that will produce the following cash flows. The cost of capital is 11 percent. (Note that the fourth year's cash flow is negative.) Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 2 3 4 5 Cash Flow $ 46,000 56,000 48,000 (56,000) 103,000 a. What is the net present value of the project? Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places. Net present value
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
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![Problem 12-14 (Algo) Net present value method [LO12-4]
Aerospace Dynamics will invest $140,000 in a project that will produce the following cash flows. The cost of capital is 11 percent. (Note
that the fourth year's cash flow is negative.) Use Appendix B for an approximate answer but calculate your final answer using the
formula and financial calculator methods.
Year
1
2
3
4
5
Cash Flow
$ 46,000
56,000
48,000
(56,000)
103,000
a. What is the net present value of the project?
Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to
2 decimal places.
Net present value](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcac0b0c2-9560-41f6-8ae9-bd6f51833be4%2Fa9007b0c-f097-4c50-9572-4fbad85ef626%2Flsnxq2_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 12-14 (Algo) Net present value method [LO12-4]
Aerospace Dynamics will invest $140,000 in a project that will produce the following cash flows. The cost of capital is 11 percent. (Note
that the fourth year's cash flow is negative.) Use Appendix B for an approximate answer but calculate your final answer using the
formula and financial calculator methods.
Year
1
2
3
4
5
Cash Flow
$ 46,000
56,000
48,000
(56,000)
103,000
a. What is the net present value of the project?
Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to
2 decimal places.
Net present value
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