4. Find all of the net present values ezto.mheducation.com/ext/map/index.html?_con=con&external_browser-D0&launcSavedConsider the following cash flows:YearCash Flow0.$34,00013,60018,10011,0003.a. What is the NPV at a discount rate of zero percent? (Do not round intermediatecalculations and round your answer to the nearest whole number, e.g.., 32.)b. What is the NPV at a discount rate of 8 percent? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g., 32.16.)c. What is the NPV at a discount rate of 18 percent? (A negative answer should beindicated by a minus sign. Do not round intermediate calculations and round youranswer to 2 decimal places, e.g., 32.16.)d. What is the NPV at a discount rate of 28 percent? (A negative answer should beindicated by a minus sign. Do not round intermediate calculations and round youranswer to 2 decimal places, e.g., 32.16.)a.Net present valueb. Net present valueC.Net present valued. Net present value< Prey4 of 6ere to search

The present value of a future sum of money or stream of cash flows with a fixed rate of return is…

34,000 %$4 13,600 18,100 11,000 the NPV at a discount rate of zero percent? ( ons and round your answer to the nearest whol he NPV at a discount rate of 8 percent? (Do not r ons and round your answer to 2 decimal places, he NPV at a discount rate of 18 nercent? (0 negat

34,000 %$4 13,600 18,100 11,000 the NPV at a discount rate of zero percent? ( ons and round your answer to the nearest whol he NPV at a discount rate of 8 percent? (Do not r ons and round your answer to 2 decimal places, he NPV at a discount rate of 18 nercent? (0 negat

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter7: Valuation Of Stocks And Corporations

Section: Chapter Questions

Problem 23SP

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

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4. Find all of the net present values

ezto.mheducation.com/ext/map/index.html?_con=con&external_browser-D0&launc
Saved
Consider the following cash flows:
Year
Cash Flow
0.
$34,000
13,600
18,100
11,000
3.
a. What is the NPV at a discount rate of zero percent? (Do not round intermediate
calculations and round your answer to the nearest whole number, e.g.., 32.)
b. What is the NPV at a discount rate of 8 percent? (Do not round intermediate
calculations and round your answer to 2 decimal places, e.g., 32.16.)
c. What is the NPV at a discount rate of 18 percent? (A negative answer should be
indicated by a minus sign. Do not round intermediate calculations and round your
answer to 2 decimal places, e.g., 32.16.)
d. What is the NPV at a discount rate of 28 percent? (A negative answer should be
indicated by a minus sign. Do not round intermediate calculations and round your
answer to 2 decimal places, e.g., 32.16.)
a.
Net present value
b. Net present value
C.
Net present value
d. Net present value
< Prey
4 of 6
ere to search

Definition Definition Calculation used to evaluate the investment and financing decisions that involve cash flows occurring over multiple periods. NPV is calculated as the difference between the present value of cash inflow and cash outflow. NPV is used for capital budgeting and investment planning as well as to compare similar investment alternatives.

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