The present worth of a multiyear investment with all positive cash flows (incomes) other than the initial investment is PW = $11,000 at MARR = i%. If MARR changes to (i + 1)%, the present worth will be: O Greater than $11,000. Cannot determine without the cash flow profile and a value for i. O Less than $11,000. O Equal to $11,000.
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- The present worth of a multiyear investment with all positive cash flows (incomes) other than the initial investment is PW = $13,000 at MARR = i%. If MARR changes to (i + 1)%, the present worth will be:Assume that an investment of $1,000 produces a future cash flow of $1,000. The discount factor for this future cash flow is 0.80. The NPV is?An investment has the following cash flow profile. For each value of MARR below, what is the minimum value of X such that the investment is attractive based on an internal rate of return measure of merit? a. MARR is 12%/yr.b. MARR is 15%/yr. c. MARR is 24%/yr. d. MARR is 8%/yr. e. MARR is 0%/yr.
- you are considered an investment with the following cash flows. If the required rate of return for that investment is 13.5% should you accept it based solely on the internal rate of return Year. Cash flows 1. -$12000 2. $5500 3. $8000 4. -$1500 A. yes, because the IRR exceeds the required return B. yes, because the IRR is a positive rate of return C. No, because the IRR is less than the required return D. you cannot apply the IRR rule in this case because there are multiple IRRs.Hi can you help with this question please? An investment has the following cash flow profile. For each value of MARR below, what is the minimum value of X such that the investment is attractive based on an internal rate of return measure of merit? EOY 0 1 2 3 4 Cash Flow $(30,000.00) $ 6,000.00 $ 13,500.00 $X $ 13,500.00 MARR is 12 percent/yearAverage Rate of Return Method, Net Present Value Method, and Analysis for a service company The capital investment committee of Arches Landscaping Company is considering two capital investments. The estimated operating income and net cash flows from each investment are as follows: Front-End Loader Year 1 2 3 4 5 Total Year 1 2 3 4 5 6 7 Operating Income 8 9 10 $54,000 54,000 54,000 54,000 54,000 $270,000 0.943 Each project requires an investment of $600,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 10% for purposes of the net present value analysis. Present Value of $1 at Compound Interest 6% 0.890 0.840 0.792 0.747 0.705 0.665 0.627 0.592 0.558 10% Net Cash Flow 0.909 0.826 0.751 $172,000 172,000 172,000 172,000 172,000 $860,000 12% 0.893 0.797 0.756 0.712 0.658 0.683 0.636 0.572 0.621 0.567 0.497 0.564 0.507 0.513 0.467 0.424 0.386 0.452 0.404 15% 0.361 0.322 0.870 0.432 0.376 0.327 0.284 0.247 Operating Income…
- A firm evaluates all of its projects by applying the IRR rule. A project under consideration has the following cash flows: Year Cash Flow O 1 2 3 $28,900 12,900 15,900 11,900 If the required return is 14 percent, what is the IRR for this project? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) IRR % Should the firm accept the project? No Yes16. You are considering an investment with the following cash flows: Year Cash Flow 0 -$50,000 1 $ 7,000 2 $ 4,000 3 $9,000 4 $61,000 What is the internal rate of return (IRR) for this investment? SHOW WORKConsider the following project: Period Net cash flow 0 -100 1 0 2 78.55 3 78.55 The internal rate of return is 20%. The NPV, assuming a 20% opportunity cost of capital, is exactly zero. Calculate the expected economic income and economic depreciation in each year. (Negative answers should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) 1 Period 2 3 Change in value (economic depreciation) (20.00) 54.55 65.46 Expected economic income
- Jiminez Company has two investment opportunities. Both investments cost $5,000 and will provide the following net cash flows: Year 1 2 3 4 What is the total present value of Investment A's cash flows assuming an 10% minimum rate of return? Use Appendix Table 2. (Do not round your intermediate calculations. Round your answer to the nearest whole dollar.) Multiple Choice O O Investment A $3,000 3,000 3,000 3,000 O O $4,510. $3,452. $3,000. Investment B $3,000 4,000 2,000 1,000 $10,628.(Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: End of Year 1 NO456TO 2 3 7 8 S A $13,000 13,000 13,000 13,000 13,000 Investment B S $13,000 13,000 13,000 13,000 (Round to the nearest cent.) C a. What is the present value of investment A at an annual discount rate of 25 percent? $37227.32 (Round to the nearest cent.) $18.000 b. What is the present value of investment B at an annual discount rate of 25 percent? 54.000 c. What is the present value of investment C at an annual discount rate of 25 percent? (Round to the nearest cent.)A firm evaluates all of its projects by applying the IRR rule. Year Cash Flow 0 –$ 148,000 1 68,000 2 71,000 3 55,000 What is the project's IRR? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) A. The Initial Rate on Return