10. Present values (2.1) A project produces a cash flow of $432 in year 1, $137 in year 2, and $797 in year 3. If the cost of capital is 15%, what is the project's PV? If the project requires an investment of $1,200, what is its NPV?
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- A project has an investment cost of $200,000 and a profitability index of 1.6. What is the net present value of the project? NPV=Consider an investment project with the cash flows given in the table below. Compute the IRR for this investment. Is the project acceptable at MARR = 10%? The IRR for this project is %. (Round to one decimal place.) n 0 1 2 3 Cash Flow -$35,000 15,000 14,520 13,99011. Thomson Electric Systems is considering a project that has the following cash flow and WACC data. What is the project's MIRR? WACC = 8% Year: Cash flows: 0 -$700 12. What is the project's IRR rate? $500 13. What is the project's payback period? 2 $200 14. What is the project's discounted payback period? 3 $400
- You've estimated the following cash flows (in $) for a project: A B 1 Year Cash flow 2 0 -3,000 3 1 900 4 2 1,300 5 3 1,606 The required return is 8.5%. 1. What is the IRR for the project? 2. What is the NPV of the project? 3. What should you do? Check all that apply: Accept the project based on its IRR Accept the project based on its NPV Reject the project based on its IRR Reject the project based on its NPVLiving Colour Co. has a project available with the following cash flows: Year Cash Flow 0 −$35,550 1 7,880 2 9,450 3 13,350 4 15,490 5 10,160 If the required return for the project is 7.6 percent, what is the project's NPV?a). When ε= 15% and MARR = 20% per year, determine whether the project (whose total cash flow diagram is shown below) is acceptable using ERR b). What is the IRR of the project ?
- A firm evaluates all of its projects by using the NPV decision rule. Year Cash Flow 0 −$ 28,000 1 24,000 2 13,000 3 6,000 a. At a required return of 28 percent, what is the NPV for this project? b. At a required return of 35 percent, what is the NPV for this project?Which of the following comes closest to the net present value (NPV) of a project whose initial investment is $5 and which produces two cash flows: the first at the end of year 2 of $3 and the second at the end of year 4 of $7? The required rate of return is 13%? Select one: a. $1.84 b. $0 c. $1.64 d. $2.05 e. $2.26A project that requires an initial investment of $340,000 is expected to have an after-tax cash flow of $70,000 per year for the first two years, $90,000 per year for the next two years, and $150,000 for the fifth year? Assume the required return for this project is 10%. Use formula solve Please!!!a. What is the NPV of the project? b. What is the IRR of the project? c. What is the MIRR of the project? d. What is the PI of the project?
- 3. You are evaluating Project A requiring an investment of $100m in year 0 after which it will generate cash flows of $50m at the end of years 10 to 20. The cost of capital is 8%. a. What is the project's NPV? b. What is its IRR?Radha Limited is evaluating a project whose expected cash flows are as follows. Year Cash flow 0 -5,00,000 1 1,00,000 2 2,00,000 3 3,00,000 4 1,00,000 What is the NPV of the project if the cost of capital is 10 percent? ? What is the Modified NPV of the project if the reinvestment rate is 13%?6. The following graph shows the NPV of a project as a function of the cost of capital. Your actual cost of capital is 12%. a. What is the IRR of the project? b. Should you take the project? Explain. Net Present Value 150,000 100,000 50,000 0% 10% 20% 30% 40% (50,000) (100,000) Cost of Capital I 50%