Moving to another question will save this response.Question 5XYZ is evaluating a project that would last for 3 years. The project's cost of capital is 17.20 percent, its NPV is $43,100.00 and the expected cash flows are presented in the table. What is 27Years from today01 2 3Expected Cash Flow (in $) -53,600 71,700 -13,000 XO An amount equal to or greater than $69,384.00 but less than $75,459.00O An amount equal to or greater than $43,100.00 but less than $52,436.00O An amount equal to or greater than $52,436.00 but less than $63,115.00O An amount equal to or greater than $63,115.00 but less than $69,384.00O An amount less than $43,100.00 or an amount greater than $75,459.00

NPV is most trusted method of capital budgeting and is based on time value of money and can be…

XYZ is evaluating a project that would last for 3 years. The project's cost of capital is 17.20 percent, its NPV is $43,100.00 and the expected cash flows are presented in the Years from today 0 2 3 Expected Cash Flow (in $) -53,600 71,700-13,000 X 1 An amount equal to or greater than $69,384.00 but less than $75,459.00 An amount equal to or greater than $43,100.00 but less than $52,436.00 An amount equal to or greater than $52,436.00 but less than $63,115.00 An amount equal to or greater than $63,115.00 but less than $69,384.00 An amount less than $43,100.00 or an amount greater than $75,459.00

XYZ is evaluating a project that would last for 3 years. The project's cost of capital is 17.20 percent, its NPV is $43,100.00 and the expected cash flows are presented in the Years from today 0 2 3 Expected Cash Flow (in $) -53,600 71,700-13,000 X 1 An amount equal to or greater than $69,384.00 but less than $75,459.00 An amount equal to or greater than $43,100.00 but less than $52,436.00 An amount equal to or greater than $52,436.00 but less than $63,115.00 An amount equal to or greater than $63,115.00 but less than $69,384.00 An amount less than $43,100.00 or an amount greater than $75,459.00

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 project requires a $33,000 initial investment and is expected to generate end-of-period annual cash inflows as follows Year 1 Year 2 $ 15,000 $ 16,000 i = 14% n=1 0.8772 { = 14% n = 2 0.7695 Year 3 $ 15,000 Assuming a discount rate of 14%, what is the net present value (rounded to the nearest whole dollar) of this investment? Selected present value factors for a single sum are shown in the table below. Multiple Choice Help {= 14% n=3 0.6750 Save & Exit Subr
Compute the payback statistic for Project A if the appropriate cost of capital is 8 percent and the maximum allowable payback period is four years. (Round your answer to 2 decimal places.) Project A Time: Cash flow: Payback 0 1 -$1,000 $350 years 2 $480 3 $520 4 $300 5 $100
Bluefield Inc. is considering a project that will require an initial investment of $20,000 and is expected to generate future cash flows of $5,000 for years 1 through 3 and $2,500 for years 4 through 6. The project’s payback period is: A. 6 years B. 5 years C. 4 years D. 67 years
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H
Kelli is considering a project that would last for 3 years and have a cost of capital of 10.98 percent. The relevant level of net working capital for the project is expected to be $9,620.00 immediately (at year 0); $30,700.00 in 1 year; $27,500.00 in 2 years; and $8,520.00 in 3 years. Relevant expected operating cash flows and cash flows from capital spending in years 0, 1, 2, and 3 are presented in the following table. What is the net present value of this project? Operating cash flows Year 0 $0.00 Year 1 Year 2 Year 3 $52,500.00 $52,500.00 $52,500.00 Cash flows from capital spending -$97,700.00 $0.00 $0.00 $7,800.00 O $99,678.69 (plus or minus $10) $84,352.32 (plus or minus $10) O $114,320.23 (plus or minus $10) $24,215.27 (plus or minus $10) None of the above is within $10 of the correct answer
A project requires a $3 million investment in net working capital (NWC) today, and will be fully recovered in 10 years. What is the PV of the NWC cash flows if r = 0.12 per annum? Enter answer in millions of dollars, rounded to the nearest thousandth (3rd digit), as in "1.123" million.
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1. What is the profitability index of a project that costs $90,000 and returns $30,000 annually for 8 years if the opportunity cost of capital is 9.6%? a.0.64 b.0.80 c.1.76 d.1.05 e.1.26 2. King Corporation is planning a 15-year project with an initial investment of $2,013,000. The project will have $563,000 cash inflows per year in years 1-2; $166,000 cash inflows in years 3-10, and $57,000 cash inflows in years 11-15. Determine the project's internal rate of return (IRR). Using financial calculator a.6.87% b.5.72% c.4.58% d.10.30% e.8.24%
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