Question
In: Finance
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)? |
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...
Shannon Industries is considering a project that has the following cash flows : Year CF...
Shannon Industries is considering a project that has the
following cash flows :
Year
CF
0
-6240
1
1980
2
3750
3
?
4
1000
The project has a payback of 2.25 years.
The firm’s cost of capital is 9.3 percent. What is the project’s
net present value (NPV)?
Tipton Industries is considering a project that has the following cash flows: Year Cash Flow 0...
Tipton Industries is considering a project that has the
following cash flows:
Year Cash Flow
0 -6,500
1 2,000
2 3,000
3 3,000
4 1,500
The project has a WACC (cost of capital) of 12%
a. what is the firm's payback?
b. what is the NPV?
c. what is the IRR?
d. is this profit profitable? explain
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 Franchise Corporation is considering an equity investment project with the following future cash flows at...
The Franchise Corporation is considering an equity investment
project with the following future cash flows at a 10% opportunity
capital cost. In relation to the capital budget decision:
Year
Cash Flows
0
($255,000)
1
125,000
2
140,000
3
-50,000
4
100,000
the project must be accepted since MIRR = 10% and NPV =
$5,074.45
the project should not be accepted since MIRR = 10% and NPV
=$5074.45
the project should be accepted since IRR...
A firm is considering an investment project with the following cash flows: Year 0 = -$110,000...
A firm is considering an investment project with the following
cash flows: Year 0 = -$110,000 (initial costs); Year 1= $40,000;
Year 2 =$90,000; and Year 3 = $30,000; and Year 4 = $60,000. The
company has a 10% cost of capital. What is the project’s discounted
payback?
1.67 years
1.86 years
1.99 years
2.08 years
A firm is considering an investment project with the following
cash flows: Year 0 = -$110,000 (initial costs); Year 1= $40,000;
Year 2 =$90,000;...
Answer the following questions. Polk Products is considering an investment project with the following cash flows:...
Answer the following questions. Polk Products is considering an
investment project with the following cash flows:
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Cashflow
-100
90
-25
-40
30
80
The company’s cost of capital is 10%, and it can get an
unlimited amount of capital at that cost.
What is the modified internal rate of return (MIRR) for the
Project?
Select one:
a. 15.77%
b. 10.80%
c. 10.18%
d. 6.03%
e. 8.54%
Polk Products is considering an investment project with the following cash flows: Year Cash Flow 0...
Polk Products is considering an investment project with the
following cash flows: Year Cash Flow 0 -$100,000 1. 20,000 2.
90,000 3. 30,000 4. 60,000 The company has a 10 percent cost of
capital. What is the project's discounted payback?
1.86 years
1.67 years
2.67 years
2.49 years
2.33 years
Dax Systems is considering a project that has the following cash flows for Project X and...
Dax Systems is considering a project that has the following cash
flows for Project X and Y. What is the PI of X, using the new
method? Cost of Capital = 10% Year Project X Project Y 0 -$1,000
-$2,000 1 $500 $1,400 2 $500 $800 3 $500 $400 0.243 0.201 0.545
0.920 0.117
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