General Motors estimates that its required rate of return is 18 percent. The company is consideringtwo mutually exclusive projects whose after-tax cash flows are as follows:Year01234MIRRS= 40.55%; MIRRL = 6.35%Project SO MIRRS-38.10%; MIRRL 9.73%O MIRRS= 40.96%; MIRRL = 10.25%O MIRRS-47.11%; MIRRL - 7.58%O MIRRS = 27.45%; MIRRL = 11.78%($320)650435360(410)What is the modified internal rate of return (MIRR) of each project?Project L($985)(450)805375455

MIRR stands for Modified Internal Rate of Return. It is a financial metric used to evaluate the…

Answered: What is the modified internal rate of…

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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a) the NPV for project "standard" is $19,972,824.09. (round to the nearest cent) The NPV for project "custom" is $ ??? (round to the nearest cent). How do I find the calculation for this?
Calculate the project's coefficient of variation. (Hint: Use the expected NPV.) Squared dev. Prob. NPV NPVI - E{NPV) Squared deviation times probability 0.24 S6,289.81 $5,829 SS 0.24 -$2,390.74 -S2,852 SS 0.32 -S1,233.33 -S1,694 $$ 0.20 -$ 400.00 -$861 SS 1.00 $ 461.11 Variance S Standard deviation $ 5.87 6.52 7.25 7.97 8.77
A project has the following NPVs at the indicated costs of capital: +$100 at 8%; +$25 at 9%; -$50 at 10%; -$100 at 11%. Which of the following is TRUE regarding this project's IRR? OA. The IRR is below 9%. B. The IRR is about 11%. C. The IRR is between 10% and 11%. D. The IRR is closer to 9% than to 10%.
The table below shows internal rate of retum for three investment projects A, B and C and there differences. By capital investment, A
Choices for last three requirements 3. What is the approximate IRR of Project A? a. 28% b. 18% c. 24% d. 21% 4. What is the approximate IRR of Project B? a. 17% b. 14% c. 20% d. 22% 5. if the crossover rate is exactly 9.31% which of the following discount rate would have a conflict in the decision making (between NPV and IRR) assuming the projects are mutually exclusive? a. 7% b. 11%
please solve this practice problem using the images below
Data Using Incremental with EUAW analysis find the best alternative, MARR = %10. You should use Excel and show your equations separately, see below example: [A Benefit - [IC (A/P, i%, n) - Salvage (A/F, i, n)] + A Cost+ G Cost (A/G, i, n)] First Cost Salvage Value Annual Benefit M&O M&O Gradient Useful Life, Years A $2,300,000 $85,000 $580,000 $65,000 $10,000 10 B $2,750,000 $125,000 $670,000 $78,000 $15,000 10 с $2,550,000 $95,000 $650,000 $72,000 $12,500 10
Given the financial data for four mutually exclusive alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =10%.
Subject: acounting
Project A has a net present value of zero when the discount factor of 20% is used. How much return is the project earning?
Clear Contacts is evaluating the following Independernt projects Project IRR Risk CD 15.0% High Average Low GH 13.0 RS 10.5 Clear's policy is to adjust its average required rate of returm, which equals 12 percent, when the risk associeted with a project is determined to be either higher-than- average or lower-than-average. The adjustment for higher-than-average risk projects is 4 percent and the ad ustment for lower-than-average nsk projects is 2 percent Which projectis) should Ciear purchase? O Projects CD and CH shouid be pchased, because they both have RRs greater than 12 percen. O Pojects GH and RS should be purchased O Only Preject Co should be purchased, becase has the highest RR O None of the perojects should be perchased. O Only Project RS should be purchased. Greater Good Glass (GGG) plans to issue a new bond with a coupon rate of interest equal to the yield to matunity (YTM) on its existing bond. The existing bond, which was issued five years ago, has a coupon rate of…
Thank you for calculating the IRR. Could you also answer the question "If the required return is 11 percent, should the firm accept the following project?". An explanation would also be extremely helpful. Thank you!

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What is the modified internal rate of return (MIRR) of each project? O MIRRS= 40.55%; MIRRL = 6.35% MIRRS 38.10 % ; MIRRL 9.73% - MIRRS= 40.96%; MIRRL = 10.25% O MIRRS-47.11%; MIRRL- 7.58% OMIRRS= 27.45%; MIRRL = 11.78%