Question
In: Finance
A firm evaluates all of its projects by applying the IRR rule. If the required return...
A firm evaluates all of its projects by applying the IRR rule. If the required return is 14 percent, should the firm accept the following project?
|
Year |
Cash Flow |
|
0 |
?$26,000 |
|
1 |
11,000 |
|
2 |
14,000 |
|
3 |
10,000 |
5.) For the cash flows in the previous problem, suppose the firm uses the NPV decision rule. At a required return of 11 percent, should the firm accept this project? What if the required return is 24 percent?
Solutions
Expert Solution
It should reject the project the project at the Required Return on 24%, as it has negative NPV.
jeff jeffy answered 2 years agoRelated Solutions
A firm evaluates all of its projects by applying the IRR rule. If the required return...
A firm evaluates all of its projects by applying the IRR rule.
If the required return is 14 percent, should the firm accept the
following project?
Year Cash Flow
0 -$30,000
1 16,000
2 20,000
3 15,000
A firm evaluates all of its projects by applying the IRR rule. If the required returns...
A
firm evaluates all of its projects by applying the IRR rule. If the
required returns is 14%, should the firm accept the following
project?
Year Cash flow
0. -$26000
1. $11000
2. $14000
3. $10000
A firm evaluates all of its projects by applying the IRR rule. A project under consideration...
A firm evaluates all of its projects by applying the IRR rule. A
project under consideration has the following cash flows?
YearCash Flow0–$28,000
1 -12,000
2 -15,000
3 -11,000
A firm evaluates all of its projects by applying the IRR rule. A project under consideration...
A firm evaluates all of its
projects by applying the IRR rule. A project under consideration
has the following cash flows:
Year
Cash Flow
0
–$
27,100
1
11,100
2
14,100
3
10,100
1．If the required return is 15 percent, what is the IRR for this
project? (Do not round intermediate calculations. Enter
your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
IRR
%
２．Should the firm accept the project?
No
Yes
A firm evaluates all of its projects by applying the IRR rule. A project under consideration...
A firm evaluates all of its
projects by applying the IRR rule. A project under consideration
has the following cash flows:
Year
Cash Flow
0
–$
27,100
1
11,100
2
14,100
3
10,100
1.If the required return is 15 percent, what is the IRR for this
project? (Do not round intermediate calculations. Enter
your answer as a percent rounded to 2 decimal places, e.g.,
32.16.)
IRR
%
2. Should the firm accept the project?
Yes
No
A firm evaluates all of its projects by applying the IRR rule. A project under consideration has the following cash flows:
A firm evaluates all of its projects by applying the IRR rule. A project under consideration has the following cash flows:
Year
Cash Flow
0
–$
28,800
1
12,800
2
15,800
3
11,800
If the required return is 13 percent, what is the IRR for this project? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
A firm evaluates all of its projects by applying the NPV decision rule. A project under...
A firm evaluates all of its projects by applying the NPV
decision rule. A project under consideration has the following cash
flows:
Year
Cash Flow
0
–$
27,400
1
11,400
2
14,400
3
10,400
What is the NPV for the project if the required return is 12
percent? (Do not round intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
NPV
$
At a required return of 12
percent, should the firm accept...
A firm evaluates all of its projects by applying the NPV decision rule. A project under...
A firm evaluates all of its projects by applying the NPV
decision rule. A project under consideration has the following cash
flows:
Year
Cash Flow
0
–$
28,600
1
12,600
2
15,600
3
11,600
What is the NPV for the project if the required return is 11
percent? (Do not round intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
At a required
return of 11 percent, should the firm accept this project?
Yes
No...
1. A firm evaluates all of its projects by applying the NPV decision rule. A project...
1.
A firm evaluates all of its projects by applying the NPV
decision rule. A project under consideration has the following cash
flows:
Year
Cash Flow
0
$
-34,000
1
15,000
2
17,000
3
13,000
If the NPV = $1.27, should the firm accept this project?
A) Yes
B) No
2.
If the NPV of the above project is as stated above, how much
value does it add to the firm, compared to investing in an
Opportunity Cost Investment project?...
A firm evaluates all of its projects by applying the NPV decision rule. A project under...
A firm evaluates all of its projects by applying the NPV
decision rule. A project under consideration has the following cash
flows:
Year
Cash Flow
0
$
-27,700
1
11,700
2
14,700
3
10,700
What is the NPV for the project if the required return is 12
percent? (Do not round intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
At a required return of 12 percent, should the firm accept this
project?
Yes...
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