You will want to invest in a business that requires an initial investment of $5,250. The business is expected to produce cash flows of $750 at the end of Year 1, $1,000 at the end of Year 2, $850 at the end of Year 3, and $6,250 at the end of Year 4. What rate of return would you earn in this business venture?
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- You have invested in a business that proudly reports that it is profitable. Your investment of $5,000 has produced a profit of $300. The managers think that if you leave your $5,000 invested with them, they should be able to generate $300 per year in profits for you in perpetuity. Evaluating other investment opportunities, you note that other long-term investments of similar risk offer an expected return of 8%. Should you remain invested in this firm? The expected return of your investment is %. (Round to one decimal place.) (Select from the drop-down menus.) If projects that are similar in horizon and risk are offering an expected return of 8%, then this business earning your opportunity cost of capital, and you should remain invested invest elsewhereWhat is the excel function and formula for this question? Off-The-Books Investment Firm, LLC, has offered you an investment it says will return to you $20,000 in 2 years. To get in, you'll need to make a $10,000 deposit to their receivables account and promise not to tell anyone about it. What is the annual return on this investment?A. Assume that you have completed your plans and proformas for the next year of operations. The upcoming year looks promising. What would you most likely do from the following list? a. From your proformas project your company’s weighted average cost of capital and return on assets, and compare the two b. Take a vacation because you have been working so hard c. Purchase a new house for your personal use because the future is looking so good d. Make sure that your company’s weighted average cost of capital exceeds your company’s return on assets, if not, rework your plans and proformas B. Assume that all sales are on account. If the average accounts receivable balance was $1,000,000 and accounts receivable turnover was 12 for the last year of operations, what was sales revenue? a. $10,000,000 b. $15,000,000 c. $12,000,000 d. $6,000,000
- You have invested in a business that proudly reports that it is profitable. Your investment of $4000 has produced a profit of $201. The managers think that if you leave your $4500 levested with them, they should be able to generate $291 per year in profits for you in perpetuity. Evaluating other investment opportunites, you note that other long-term investments of similar risk offer an expected return of 7.9%. Should you remain invested in this fr ? The expected ratus of your envestment is__? (Round to one decimal)SVR Clinical Research, LLC Mrs. Seaver, a microbiologist and pharmacist, has developed a drug therapy to treat dysphagia (swallowing problems). She discovered that a combination of existing drugs should address problems with swallowing that have only marginal treatments available to date. Since the therapy is using currently approved drugs, safety of the treatment is expected. It should allow the drug to enter Phase 2 clinical trials very soon after the firm raises its first $3 million in seed capital. Startup investors recognize that they are investing in firms with no history and with significant risk. They evaluate investment opportunities using required returns in the range of 10x5 (That is, the investors want to have their investment return to be 10 times great than the initial investment at the end of 5 years.) Mrs. Seaver's team has developed a clinical trial plan using major research medical centers such as the Vanderbilt University Medical Center and the Cleveland Clinic. The…If you had $100,000 available for investing, which of these companies would you choose to invest with? Support your answer with analysis of free cash flow, based on the data provided, and include in your decision whatever other reasoning you chose to utilize.
- An investor is considering starting a new business. The company would require $500,000 of assets, and it would be financed entirely with common stock. The investor will go forward only if she thinks the firm can provide a 15.0% return on the invested capital, which means that the firm must have an ROE of 15.0%. How much net income must be expected to warrant starting the business?Entrepreneurshipsuppose that you have started a manufacturing/Service Organization in Abu Dhabi UAE with a capital of $200,000-$800,000. You are free to assume/invest within the range of $200,000 - $800,000, depending on the size of the business. 1-you need to assume cash flows with assumed discounted rate for five years and calculate the NPV of the project. 2- Find out the BEP (Break Even Point) of your business and take necessary actions on the basis of your results.
- You are considering investing in a start up company. The founder asked you for $210,000 today and you expect to get $1,070,000 in 11 years. Given the riskiness of the investment opportunity, your cost of capital is 28%. What is the NPV of the investment opportunity? Should you undertake the investment opportunity? Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged. What is the NPV of the investment opportunity? The NPV of the investment is $ (Round to the nearest dollar.) Should you undertake the investment opportunity? Since the NPV is the deal! (Select from the drop-down menus.) Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged. The IRR is%. (Round to two decimal places.) The maximum deviation allowable in the cost of capital is%. (Round to two decimal places.) www you shouldYou have an investment opportunity that promises to pay you $18,000 in four years. You could earn a 5% annual return investing elsewhere. What is the maximum amount you would be willing to invest in this opportunity? Note: Use tables, Excel, or a financial calculator. Round your final answer to nearest whole dollar amount. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)As Financial Manager what would be your decision on assets and investment mattersto meet profit maximization? Analyze carefully and encircle your best answer.