Problem # 2 (3/10): A cash flow sequence has a disbursement of $15,000 today, followed by three receipts of $8,000 at the end of year one, two and three. A final disbursement of $3,000 occurred at the end of year 4. The MARR is 10%. Check if this cash flow sequence is "simple"? If the cash flow sequence is 'simple', calculate the IRR for this project. If the cash flow sequence is NOT 'simple', calculate the approximate-ERR for this project. Decide whether the project should be accepted or not.

Problem # 2 (3/10): A cash flow sequence has a disbursement of $15,000 today, followed by three receipts of $8,000 at the end of year one, two and three. A final disbursement of $3,000 occurred at the end of year 4. The MARR is 10%. Check if this cash flow sequence is "simple"? If the cash flow sequence is 'simple', calculate the IRR for this project. If the cash flow sequence is NOT 'simple', calculate the approximate-ERR for this project. Decide whether the project should be accepted or not.

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. You expect to receive $1,000 in one year, $2,000 in three years, and $1,500 in five years. Assume that the appropriate discount rate is 13%. a. Display these cash flows in a spreadsheet using the layout of a time line. Enter all period numbers (up to year 5) in one row, and the expected cash flows in the next row. b. What is the present value of these expected cash flows? Your answer should consist of one spreadsheet file with all your work in one worksheet. it should answer in excel file
What is the present value of a stream of 5 end-of-year annual cash receipts of $1,000 given a discount rate of 13%? (Round your final answers to 2 decimal places.) a. Use the appropriate table (Appendix C: Table 1, Table 2) to answer the above question. b. Use the appropriate built-in function in Excel to answer the above question.
Draw the cashflow diagram and solve using the formula
1. Consider the following cash flow payments: An income of $2000 at the end of year 2, an income of $5000 at the end of year 4, an expense of $3000 at the end of year 8, and a final income of $4000 at the end of year 10. (a) Draw the cash flow diagram for the cash flow payments. (b) Write an expression: what is the present equivalent value of these payments over the 10-year period assuming an interest rate of 10% per year. Just write down the expression like "e.g. P = 1,000 (P/F, 4%, 10) + 2,500 (P/A, 4%, 5)-4,000". You don't need to calculate the final numerical answer. (Hint: you can write out the present equivalent value for each cash flow, and then sum them up.)
Attach a complete solution. Draw the cash flow diagram.Suppose that P 4500 is deposited each year into a bank account that pays 8% interest compounded quarterly. How much would be accumulated in his fund by the end of the 4th year? The first payment occurs at time zero (now).
What is the payback period for the following set of cash flows? (Round your answer to 2 decimal places, e.g., 32.16.) Year Cash Flow 0 –$ 4,700 1 1,100 2 1,300 3 2,125 4 1,200
ANSWER THE PROBLEM QUESTION AND BOX THE FINAL ANSWER. WRITE ON A CLEAR PAPER CLEARLY.
Problem #1: For the following cash flows, (receipt of 10,000 at t=0; payment of 15,000 at t=1; receipt of 12,000 at t=2; and receipt of 12,000 at t-6), various interest rates are applied: 3% for year 1; 4% for year 2, 5% for years 3 and 4, and 6% for years 5 and 6. Find the equivalent net value at t=5, i.e., Fs=? 10,000 12,000 3% 4% 5% 0 1 2 I 15,000 F₂-? I 12,000 5% 6% 6% m
Suppose you need $5,000 in one year, $4,300 more in two years, and $5,000 more in three years. Match each present value amount to the corresponding cash flow, assuming a discount rate of 17%. (Round all answers to two decimal places.) Instructions Drag and drop application. Present value of the Year 1 cash flow Present value of the Year 1 cash flow drop zone empty. Present value of the Year 2 cash flow Present value of the Year 2 cash flow drop zone empty. Present value of the Year 3 cash flow Present value of the Year 3 cash flow drop zone empty. $3,141.21 $3,121.85 $4,273.50
We want to determine the discount rate that sets the present value of the future net cash flow. Suppose that we start with a 15% discount rate and calculate the present value of the cash flow stream. Initial Cash Outflow is $1,00,000. Find IRR. Year Net Cash flows 1 $34,432 2 $39,530 3 $39,359 4 $32,219
Consider the following cash flows: Year 0 1 2 3 4 Cash Flow -$ 7,700 1,900 3,000 2,300 1,700 What is the payback period for the cash flows? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Payback period years
What is the payback period for the following set of cash flows? (Round your answer to 2 decimal places, e.g., 32.16.) Cash Year Flow $5,500 1 1,275 1,475 1,875 1,375 3 4 Payback period years

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