M4 - Practical Application 2

NOTE: JUST ANSWER 3. Accounting rate of return4. Profitability index

quiz is acceptung Question 1 (10 points) The Internal Rate of Return is a financial measure that allows us to estimate: a The nominal value of the returns on a project. b The profitability of a potential investment in a project. The variance of returns on a project. The median of the returns on a project. Next Page Once you click Next Page you will not be able to change you answer Support | Schoology Blog I PRIVACY POI JUN 30 MacBook Air

6.Calculate the project's Modified Internal Rate of Return (MIRR). What critical assumption does the MIRR make that differentiates it from the IRR?   TIP : look for the definition of Modified Internal Rate of Return, and then do it in excel, easy !!!   Year Net Cash flow Future Value of Net Cash flow 0 -$20.8 example 1 $4.5 $7.97   (n=6, i=10%)=fv(.1,6,,4.5) 2 $6.3  (n=5, i=10%) 3 $5.2    (n=4, i=10%) 4 $3.9   (n=3, i=10%)  5 $2.1   (n=2, i=10%) 6 $1.3    (n=1, i=10%) 7 $0.5    (n=0, i=10%)     Sum = $XX.XX     MIRR = ( in excel ) Rate ( 7,-20.8, xx.xx)   7.Where does the value of MIRR fall relative to the discount rate and IRR?

Answer the following fast- A.    Task whose incomes are adequate to compensate capital contributed for pace of return at that point net present worth will be    A. negative    B. zero    C. positive    D. autonomous    B.    Present estimation of future incomes is Rs 2000 and an underlying expense is Rs 1100 then benefit file will be    A. 55.00%    B. 1.82    C. 0.55    D. 1.82%    C.    Benefit record in capital planning is utilized for    A. negative undertakings    B. relative undertakings    C. assess projects    D. acquired tasks    D.    Different elements held steady, more prominent venture liquidity is a result of    A. less undertaking return    B. more prominent venture return    C. more limited compensation period    D. more prominent restitution period    E.    In count of inside pace of return, a supposition expresses that got income from project must    A. be reinvested    B. not be reinvested    C. be acquired    D. not be acquired    F.    In capital planning, number…

From the problem below :1. For capital budgeting purposes, what is the net investment in the new, high-performing machine?A. P186,400B. P185,000C. P169,600D. P148,000 2. What is the payback period?A. 4.49 yearsB. 5.24 yearsC. 5.76 yearsD. None from the choices 3. Compute the new, high-performing machine's net present value.A. P1,200B. P15,892C. P28,025D. P6,729

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**Please solve using Excel and show formulas.** Consider the  following projects: Project Cash Flows               A -4 5 2.3 0 0 1,000 B -5,600 2,800 2,800 5,800 2,800 2,800 C -7,000 2,800 2,500 0 2,800 2,800 Question: What is the payback period for Project C? Multiple Choice   3.4   3.9   3.2   3.6   3.8

Value/other investment criteria (i Saved Help Save Consider the following two projects: Cash flows Project A Project B -$270 CO -$270 С1 115 143 C2 115 143 Сз 115 143 C4 115 a. If the opportunity cost of capital is 10%, which of these two projects would you accept (A, B, or both)? b. Suppose that you can choose only one of these two projects. Which would you choose? The discount rate is still 10%. Which one would you choose if the cost of capital is 15%? d. What is the payback period of each project? e. Is the project with the shortest payback period also the one with the highest NPV? f. What are the internal rates of return on the two projects? g. Does the IRR rule in this case give the same answer as NPV? h-1. If the opportunity cost of capital is 10%, what is the profitability index for each project? h-2. Is the project with the highest profitability index also the one with the highest NPV? h-3. Which measure should you use to choose between the projects? Complete this question by…

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Mc Graw Hill Risk and Capital Budgeting AA Fill in the blank: Scenario analysis is made up of several Correct Michael Scenarios Michael We have created various scenarios each with a forecast for our expected sales volume, revenues, expenses, risks, etc. At a high level, here are how each of the scenarios looks like. Calculate NPV for Scenario A. Use the information provided on the right. Round to the nearest whole number. Submit Enter a response then click Submit below $0 Scenarios Area 1.1 Scenario Comparison ($) Scenario A Scenario B Scenario C Initial Investment 2,000,000 2,000,000 2,000,000 Expected interest rate: 12% Forecasting period: 5 years PV annuity factor: 3.6048 Annual Net Income 545, 100 426,995 1,644,385 Annual Cash Flow 656,890 -493, 005 2,564,385 NPV -3,777, 184 7,244,095 Return to Activity Score Materials

Question The following economical indictors are referring to types of project (A and B). Answer the following points according to these given indictors in the tables. project A:r=8% project B: r=8% year cash flow (CF) year cash flow (CF) 0 -598 0 -384 1 110 1 105 2 170 2 105 3 210 3 95 4 320 4 118 A) If you are aware that( r%) percentages are various for different reasons to be (10% and 20%). So determine level of NPV during your analysis procedures for whole the mentioned cases of (% r) for each project? B) Which one of the mentioned project are more economically by using concept of IRR and take the range of (% r) between (9% to %25) for supporting your answers? C) Drawing out all the levels of various of the project for each cases of (r %) which given initially in point (A) above. D) Give clear justification about any of the above project more feasible?

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Which of the following is FALSE regarding various methods of project analysis? Both NPV and IRR consider the time value of money. Average Accounting Return ignores the time value of money. Payback focuses on liquidity. O Profitability Index is able to rank projects in the situation of capital rationing. () Payback considers the time value of money. Next Page Page 17 of 3 Previous Page Submit Quiz O of 30 questions saved