Question
In: Finance
A project has the following total (or net) after-tax cash flows. ____________________________________________________ Year&nbs
A project has the following total (or net) after-tax cash flows.
____________________________________________________
Year Total (or net) after-tax cash flow
____________________________________________________
1 $1,000,000
2 1,500,000
3 2,000,000
4 2,500,000
_______________________________________________________
The required rate of return on the project is 15 percent. The
initial investment (or initial cost or initial outlay) of the
project is $4,000,000.
a) Find the (regular) payback period of the project.
b) Compute the discounted payback period of the project.
c) Find the net present value (NPV) of the project.
d) Find the profitability index (PI) of the project.
e) Calculate the modified internal rate of return (MIRR) of the
project.
Solutions
jeff jeffy answered 2 years agoRelated Solutions
A project has the following total (or net) cash flows. __________________________________________ &nbs
A project has the following total (or net) cash flows.
__________________________________________
Year Total
(or net) cash flow
_________________________________________
1 $20,000
2 30,000
3 50,000
4 60,000
_________________________________________
The required rate of return on the project is 15 percent. The
initial investment (or initial cost or initial outlay) of the
project is $80,000.
a) Find the net present value (NPV) of the project.
b) Find the profitability index (PI) of the project.
c) Calculate the modified internal rate...
A project has the following total (or net) cash flows. __________________________________________ &nbs
A project has the following total (or net) cash flows.
__________________________________________
Year Total
(or net) cash flow
_________________________________________
1 $20,000
2 30,000
3 50,000
4 60,000
_________________________________________
The required rate of return on the project is 15 percent. The
initial investment (or initial cost or initial outlay) of the
project is $80,000.
a) Find the net present value (NPV) of the project.
b) Find the profitability index (PI) of the project.
c) Calculate the modified internal rate...
6. A project has the following total (or net) cash flows. __________________________________________ Year Total (or net)...
6. A project has the following total (or net) cash flows.
__________________________________________
Year Total (or net) cash flow
_________________________________________
1- $20,000
2- 30,000
3- 50,000
4- 60,000
_________________________________________
The required rate of return on the project is 15 percent. The
initial investment (or initial cost or initial outlay) of the
project is $80,000.
a) Find the net present value (NPV) of the project.
b) Find the profitability index (PI) of the project.
c) Calculate the modified internal rate of return...
A project has the following total (or net) cash flows. ________________________________________
A project has the following total (or net) cash flows.
________________________________________
Year Total (or net)
cash flow
________________________________________
1 $50,000
2 70,000
3 80,000
4 100,000
_______________________________________
The required rate of return on the project is 13 percent. The
initial investment (or initial cost or initial outlay) of the
project is $100,000.
a) Find the (regular) payback period of the project.
b) Compute the discounted payback period of the project.
6. A project has the following...
what is the net present value of a project with the following after tax cash flows...
what is the net present value of a project with the following after
tax cash flows using a discount rate of 10% year 0 45,000 year 1
14,000 year 2 14,000 year 3 10,000 year 4 10,000 year 5 8,000
would you accept the project? ehat is payback period? what is the
profitbility index?
A capital budget project is estimated to have the following after-tax cash flows, by year: 0...
A capital budget project is estimated to have the
following after-tax cash flows, by year:
0
1
2
3
4
-$35,000
$13,000
$15,000
$17,000
$19,000
Use the information in the table above for the following
questions 11a. through 11f. The company utilizes a discount rate of
9% to evaluate capital projects. You may have rounding errors in
your calculations so choose the closest answer.
1. Find NPV, IRR, MIRR, and PI for the project shown
above
2. Find Payback and...
Braun Industries is considering an investment project that has the following cash flows: &nbs
Braun Industries is considering an investment project that has
the following cash flows:
Project
Year Cash
Flows
0 -$641
1 $421
2 $407
3 $490
The company’s WACC is 10.5 percent. What is the
project’s payback, internal rate of return (IRR), and net present
value (NPV)?
A four-year financial project has estimates of net cash flows shown in the following table: Year...
A four-year financial project has estimates of net cash flows
shown in the following table:
Year
Net Cash Flow
1
$20,000
2
25,000
3
30,000
4
35,000
It will cost $65,000 to implement the
project, all of which must be invested at the beginning of the
project. After the fourth year, the project will have no residual
value.
Using the most likely estimates of
cash flows, conduct a discounted cash flow calculation assuming a
20 percent hurdle rate with no...
FINA Inc. considers a project with the following information: Initial Outlay: 1,500 After-tax cash flows: Year...
FINA Inc. considers a project with the following information:
Initial Outlay: 1,500 After-tax cash flows: Year 1: -$100 Year 2:
$1000 Year 3: $700 FINA’s assets are $500 million, financed through
bank loans, bonds, preferred stocks, and common stocks. The amounts
are as follows: Bank loans: $ 100 million borrowed at 10% Bonds:
$180 million, paying 9% coupon with quarterly payments, and
maturity of 5 years. FINA sold its $1,000 par-value bonds for
$1,070 and had to incur $20 flotation...
FINA Inc. considers a project with the following information: Initial Outlay: 1,500 After-tax cash flows: Year...
FINA Inc. considers a project with the following
information:
Initial Outlay: 1,500
After-tax cash flows:
Year 1: -$100
Year 2: $1000
Year 3: $700
FINA’s assets are $500 million, financed through bank loans,
bonds, preferred stocks, and common stocks. The amounts are as
follows:
Bank loans: $ 100 million borrowed at 10%
Bonds: $180 million, paying 9% coupon with quarterly payments,
and maturity of 5 years. FINA sold its $1,000 par-value bonds for
$1,070 and had to incur $20 flotation cost...
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