Question 1: What is the present value (PV) of the following series of cash flows at...

Question 1: What is the present value (PV) of the following series of cash flows at 10% and its IRR? Year 0: -2,000$ | Year 1: +800$ | Year 2: +600$ | Year 3: +700$ | Year 4: +500$

Question 2: Draw a present value (PV) profile of the following project and determine the IRR(s). Is the project acceptable at 10% cost of capital? Year 0: -4,000$ | Year 1: +10,200$ | Year 2: -6,300$ Observation: if you find cumbersome to draw the PV profile you can only describe it in words, namely: (a) what's on X axes, (b) what's on the Y axes, (c) form of the graph, (d) where it intercepts the X axes etc.

Question 3: A firm is considering a project with a cash flow outlay of 1,000$ now and 5 annual inflows of 500$ a) What is the NPV (net present value) at 10% b) What is the NPV assuming a general inflation rate of 8% and an increase in cash flow to $510 pe annum?

Expert Solution

jeff jeffy answered 1 year ago

Use Table PV-1 and Table PV-2 to determine the present values of the following cash flows.

Use Table PV-1 and Table PV-2 to determine the present values of the following cash flows. (For all requirements, round PV factor to 3 decimal places, Intermediate and final answer to the nearest dollar amount.) a. $15,000 to be paid annually for 10 years, discounted at an annual rate of 6 percent. Payments are to occur at the end of each year. b. $9,200 to be received today, assuming that the money will be invested in a two-year certificate of deposit earning 8 percent annually. c. $300...

An investment costs $200,000. If the present value (PV) of all the future cash flows is...

An investment costs $200,000. If the present value (PV) of all the future cash flows is $175,000, which of the following statements is correct? a. The project should be rejected since the Profitability Index is less than 1. b. The project should be rejected since the NPV is $25,000. c. The project should be accepted since the Profitability Index is greater than 0 d. The project should be rejected since the NPV is -$175,000.

Find the net present value (NPV) for the following series of future cash flows, assuming the...

Find the net present value (NPV) for the following series of future cash flows, assuming the company’s cost of capital is 6.64 percent. The initial outlay is $339,858. Year 1: 163,676 Year 2: 147,656 Year 3: 123,800 Year 4: 178,407 Year 5: 149,077 Round the answer to two decimal places.

What is the present value of the following cash flows at a discount rate of 6%?...

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If the discount rate is 12%, what is the present value of the following cash flows:...

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. What is the present value of the following set of cash flows, discounted at 10.8...

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The present value of the following cash flows at 6% interest would be what? YEAR CASH...

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1. Calculate the present value of the following cash flows: What is $10,000 received five years...

1. Calculate the present value of the following cash flows: What is $10,000 received five years in the future worth today if the discount rate is 4%? ________ What is $10,000 received ten years in the future worth today if the discount rate is 4%? ________ What is $10,000 received five years in the future worth today if the discount rate is 8%? ________ What is $10,000 received ten years in the future worth today if the discount rate is...

For what value of W will the NPV of the series of cash flows be zero...

For what value of W will the NPV of the series of cash flows be zero at 12% per period interest rate? please use excel and the Goal seek function solving for W. and explain work please....the answer is one of the four Year Cash Flow 0 +$25000 1 -4W 2 18W 3 -16W 4 48W 5 -64W 6 42W 7 -256W 8 52W 9 -64W 10 42W 11 -256W 12 52W $98 $124 $167 $184

What is the net present value of the following cash flows if the relevant discount rate...

What is the net present value of the following cash flows if the relevant discount rate is 9 percent? Year Cash Flow 0 -11,520 1 81 2 650 3 880 4 2300 5 15,800 A) $1,300.54 B) $1,913.12 C) $1,679.22 D) $1,022.87 E) $1,506.54 45) SNR is considering a project with an initial cost of $50,000. The project will produce cash inflows of $10,000 a year for the first two years and $12,000 a year for the following three years....

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