Question
In: Finance
(Payback period calculations) You are considering three independent projects: project A, project B, and project C....
(Payback period calculations) You are considering three independent projects: project A, project B, and project C. Given the free cash flow information in the popup window, calculate the payback period for each. If you require a 3-year payback before an investment can be accepted, which project(s) would be accepted?
Initial Outlay -900 -10,000
-6,500
Inflow year 1 700 6,000
2,000
Inflow year 2 400 4,000
2,000
Inflow year 3 200 4,000
4,000
Inflow year 4 100 4,000
4,000
Inflow year 5 600 4,000
4,000
Solutions
jeff jeffy answered 1 year agoRelated Solutions
(Payback period calculations) You are considering three independent projects: project A, project B, and project C....
(Payback period calculations) You are considering three
independent projects: project A, project B, and project C. Given
the cash flow information in the popup window,calculate the
payback period for each. If you require a 3-year payback before an
investment can be accepted, which project(s) would be
accepted?
Initial Outlay -950 -9000
-6500
Inflow year 1 700 4000
2000
Inflow year 2 200 3000
2000
Inflow year 3 100 3000
3000
Inflow year 4 300 3000
3000
Inflow year 5 500 ...
(NPV, PI, and IRR calculations) You are considering two independent projects, project A and project B....
(NPV,
PI, and IRR
calculations)
You are considering two independent projects, project A and
project B. The initial cash outlay associated with project A is
$50,000
and the initial cash outlay associated with project B is
$70,000
The required rate of return on both projects is
9
percent. The expected annual free cash inflows from each project
are in the popup window:
Calculate the
NPV,
PI,
and IRR for each project and indicate if the project should be
accepted.
...
(NPV, PI, and IRR calculations) You are considering two independent projects, project A and project B....
(NPV,
PI, and IRR
calculations)
You are considering two independent projects, project A and
project B. The initial cash outlay associated with project A is
$50,000
and the initial cash outlay associated with project B is
$70,000
The required rate of return on both projects is
12
percent. The expected annual free cash inflows from each project
are in the popup window:
.Calculate the
NPV,
PI,
and IRR for each project and indicate if the project should be
accepted.
a....
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback
period, NPV, PI, and IRR
calculations)
You are considering a project with an initial cash outlay of
$90,000
and expected free cash flows of
$28,000
at the end of each year for
5
years. The required rate of return for this project is
6
percent.
a. What is the project's payback period?
b. What is the project's
NPV?
c. What is the project's
PI?
d. What is the project's
IRR?
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback period, NPV, PI, and IRR calculations) You are
considering a project with an initial cash outlay of $80000 and
expected free cash flows of $25000 at the end of each year for 6
years. The required rate of return for this project is 9
percent.
a. What is the project's payback period?
b. What is the project's NPV?
c. What is the project's PI?
d. What is the project's IRR?
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback period, NPV, PI, and IRR calculations) You are
considering a project with an initial cash outlay of $70,000 and
expected free cash flows of $28,000 at the end of each year for 5
years. The required rate of return for this project is 8
percent.
a. What is the project's payback period?
b. What is the project's NPV?
c. What is the project's PI?
d. What is the project's IRR?
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback period, NPV, PI, and IRR calculations) You are
considering a project with an initial cash outlay of $90,000 and
expected free cash flows of $22,000 at the end of each year for 7
years. The required rate of return for this project is 9
percent.
a. What is the project's payback period?
b. What is the project's NPV?
c. What is the project's PI?
d. What is the project's IRR?
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback period, NPV, PI, and IRR calculations) You are
considering a project with an initial cash outlay of $90,000 and
expected free cash flows of $26,000 at the end of each year for 6
years. The required rate of return for this project is 6
percent.
a. What is the project's payback period?
b. What is the project's NPV?
c. What is the project's PI?
d. What is the project's IRR?
(Payback period, NPV, PI, and IRR calculations) You are considering a project with an initial cash...
(Payback period, NPV, PI, and IRR calculations) You are
considering a project with an initial cash outlay of $80,000 and
expected free cash flows of $24,000 at the end of each year for 7
years. The required rate of return for this project is 6
percent.
a. What is the project's payback period?
3.33 years
b. What is the project's NPV?
____
c. What is the project's PI?
_____
d. What is the project's IRR?
_____
The table below lists the projects that your company is considering to invest: Project Payback Period...
The table below lists the projects that your company is
considering to invest:
Project Payback Period (Years) NPV
(USD) IRR (%)
A 4.7 53000 15.44
B 2.1 17000 17.76
C 4.7 18000 16.75
D 4.4 14000 17.05
E 2.8 14000 17.15
The required return is 14.6 percent. Which project should be
accepted if they are mutually exclusive?
E
D
C
B
A
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