Question
In: Finance
Klueber, Inc. is reviewing a project with the below cash flows: Year Stock A 0 -100,000...
Klueber, Inc. is reviewing a project with the below cash flows:
|
Year |
Stock A |
|
0 |
-100,000 |
|
1 |
30,000 |
|
2 |
45,000 |
|
3 |
75,000 |
The project’s required rate of return is 7.5%.
24. Please calculate the net present value (NPV) of this project.
25. Based upon the above NPV calculation, should this project be accepted? Why?
26. Please calculate the payback period of this project.
27. Based upon the above payback period of this project, should this project be accepted? Why?
28. Please calculate the discounted payback period of this project.
29. Based upon the above discounted payback period of this project, should this project be accepted? Why?
Solutions
jeff jeffy answered 1 year agoRelated Solutions
Klueber, Inc. is reviewing a project with the below cash flows: Year Stock A 0 -100,000...
Klueber, Inc. is reviewing a project with the below cash
flows:
Year
Stock A
0
-100,000
1
30,000
2
45,000
3
75,000
The project’s required rate of return is 7.5%.
Please calculate the net present value (NPV) of this
project.
Based upon the above NPV calculation, should this project be
accepted? Why?
Please calculate the payback period of this project.
Based upon the above payback period of this project, should this
project be accepted? Why?
Please calculate the discounted payback...
The following are the cash flows of two projects: Year Project A Project B 0 ?$...
The following are the
cash flows of two projects:
Year
Project A
Project B
0
?$
380
?$
380
1
210
280
2
210
280
3
210
280
4
210
If the opportunity
cost of capital is 11%, what is the profitability index for each
project? (Do not round intermediate calculations. Round
your answers to 4 decimal places.)
The following are the cash flows of two projects: Year Project A Project B 0 ?$...
The following are the cash flows of two projects:
Year Project A Project B
0 ?$ 280 ?$ 280
1 160 180
2 160 180
3 160 180
4 160
If the opportunity cost of capital is 10%, what is the
profitability index for each project? (Do not round intermediate
calculations. Round your answers to 4 decimal places.) Project A
Profitability Index Project B
The following are the cash flows of two projects: Year Project A Project B 0 −$...
The following are the cash flows of two projects: Year Project A
Project B 0 −$ 290 −$ 290 1 170 190 2 170 190 3 170 190 4 170 If
the opportunity cost of capital is 11%, what is the profitability
index for each project? (Do not round intermediate calculations.
Round your answers to 4 decimal places.)
The following are the cash flows of two projects: Year Project A Project B 0 $...
The following are the cash flows of two projects:
Year
Project A
Project B
0
$
(330)
$
(330)
1
160
230
2
160
230
3
160
230
4
160
If the opportunity cost of capital is 12%, what is the
profitability index for each project? (Do not round
intermediate calculations. Round your answers to 4 decimal
places.)
Project Profitability Index:
A
B
The following are the cash flows of two projects: Year Project A Project B 0 ?$...
The following are the cash flows of two projects: Year Project A
Project B 0 ?$ 220 ?$ 220 1 100 120 2 100 120 3 100 120 4 100 If
the opportunity cost of capital is 10%, what is the profitability
index for each project? (Do not round intermediate calculations.
Round your answers to 4 decimal places.)
The following are the cash flows of two projects: Year Project A Project B 0 $...
The following are the
cash flows of two projects:
Year
Project A
Project B
0
$
(260
)
$
(260
)
1
140
160
2
140
160
3
140
160
4
140
a. Calculate the NPV for both projects if the
opportunity cost of capital is 16%. (Do not round
intermediate calculations. Round your answers to 2 decimal
places.)
Project A
Project B
b.
Suppose that you can choose only one of these projects. Which would
you choose?
Project A...
There is a project with the following cash flows : Year Cash Flow 0 −$21,800 1...
There is a project with the following cash flows :
Year
Cash Flow
0
−$21,800
1
6,300
2
7,350
3
6,750
4
4,400
What is the payback period?
Multiple Choice
a. 4.00 years
b. 3.32 years
c. 3.74 years
d. 3.56 years
e. 2.79 years
There is a project with the following cash flows : Year Cash Flow 0 −$23,700 1...
There is a project with the following cash flows :
Year
Cash Flow
0
−$23,700
1
7,000
2
7,700
3
7,100
4
5,100
What is the payback period?
Multiple Choice
2.73 years
4.00 years
3.81 years
3.63 years
3.37 years
Project A is as follows: $100,000 upfront cost and annual cash flows of $25,000 a year...
Project A is as follows: $100,000 upfront cost and annual cash
flows of $25,000 a year for seven years. Project B is as follows:
$100,000 upfront cost and cash flow of $20,000 per year for 8
years. what are the payback periods for projects A and B?
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