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In: Accounting

1) tesla is planning to produce an all-electric family car and expects the following cash flows(in$million)...

1) tesla is planning to produce an all-electric family car and expects the following cash flows(in$million) at the end of each year:
year 0   
cash flow-180;year 1 cash flow10; year2 cash flow20; year 3 cash flow 40; year5 cash flow 110.
the required return for the project is 11%.
a. create an excel spreadsheet with the present value of each cash flow. what is the projects Nvp?
b.there is an easier way: what is the NVp using excels Nvp function? note that excels Nvp function all the cash flows in the range, even the first one

2)you've estimated the following cash flows(in$) for a project: A. B.
year. cash flow
0 -5,600
1 1,325
2 2,148
3 3,472
required return for project is 8%
What is the IRR for the project?
3)you've estimated the following cash flows (in$) for two mutually exclusive projects
year. projectA projectB
0 -5,700 -8,550
1 1,325 1,325
2 2,148 2,148
3 4,429 8,245
the required return for both projects is 8%
What is the IRR for project B?
What is NVP for project A?
What is NVP for project B?

Solutions

Expert Solution

The following is the answer for the above questions, i will include the cell reference of formulas used also in the end for the question 1 and for one IRR calculation.

Screen Shots of Formulas Used:

ekkarill92 answered 1 year ago
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