​(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   3000   3000

Q2) A firm has a WACC of 9.32% and is deciding between two mutually exclusive projects. Project A has an initial investment of $62.78. The additional cash flows for project A are: year 1 = $17.67, year 2 = $36.32, year 3 = $48.38. Project B has an initial investment of $72.71. The cash flows for project B are: year 1 = $51.70, year 2 = $39.41, year 3 = $22.75. Calculate the Following: a) Payback Period for Project A: (2 points) b) Payback Period for Project B: (2 points) c) NPV for Project A: (2 points) d) NPV for Project B: (2 points)

the Edison Company own and operates coffe shops throughout middlesex county. Edison company has declared the following annual dividends over a six year period: year 1 80,000; year2; 90,000; year 3 150,000; year 5, 160,000; outstanding stock of the company was composed of 250,000 shares of cumulative, preferred 2% stock, $20 par and 500,000 shares of common stock, $15 par. complete the schedule showing the total dividend and the per share dividend on each class of stock for the period ended 12/31 of each year. there were no dividends in arrears at the beggining of year 1

a certain hospital is considering setting up a new facility. Management estimates that it will cost $1.5 million to purchase the necessary equipment and renovate the building to support its long term care services. The projected net cash flows generated by the new facility over the next five years are given below:

Year 1 -0

Year 2 $380,000

Year 3 $400,000

Year 4 $420,000

Year 5 $440,000

Assuming a five year life and 8% cost of capital, compute the net present value of this proposal. On the merits of your net present value computation, should this hospital invest in this project?

Do workers prefer to buy lunch rather than pack their own lunch? A survey of employed Americans found that 75% of the 18 to 24 year-olds, 77% of the 25 to 34 year-olds, 72% of the 35 to 44 year-olds, 58% of the 45 to 54 year-olds, 57% of the 55 to 64 year-olds, and 55% of the 65 + year-olds buy lunch throughout the workweek. Suppose the survey was based on 200 employed Americans in each of six age groups.

a. At the 0.05 level of significance, is there evidence of a difference among the age groups in the preference for buying lunch?

b. Determine the p-value in (a) and interpret its meaning.

Down Under Boomerang, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.37 million. The fixed asset falls into the 3-year MACRS class (MACRS schedule). The project is estimated to generate $1,765,000 in annual sales, with costs of $664,000. The project requires an initial investment in net working capital of $360,000, and the fixed asset will have a market value of $345,000 at the end of the project.

Heavy Metal Corporation is expected to generate the following free cash flows over the next five​ years:
(in millions)

Year 1 : 54.4

Year 2: 66.2

Year 3: 79.5

Year 4: 73.6

Year 5: 80.2

Thereafter, the free cash flows are expected to grow at the industry average of 4.5% per year. Using the discounted free cash flow model and a weighted average cost of capital of 14.6%​:

a.  Estimate the enterprise value of Heavy Metal.

b.  If Heavy Metal has no excess​ cash, debt of $304 ​million, and 41 million shares​ outstanding, estimate its share price.

The cash flows for three independent projects are found below.

Year 0 (Initial investment) Project A $(45,000) Project B $(120,000) Project C $(460,000)

Year 1 $12,000    $ 30,000 $ 220,000

Year 2 $14,000 $ 30,000 $ 220,000

Year 3 $ 19,000 $ 30,000 $   220,000

Year 4 $ 27,000 $ 30,000 -

Year 5   

a. Calculate the IRR for each of the projects. b. If the discount rate for all the three projects is 16 percent, which projects or projects would you want to undertake? c. What is the net present value of each projects where the appropriate discount rate is 16 percent? a. The IRR of project A is.