A project has the following cash flows: Year 0: 74000 Year 1: -49000 Year 2:  -41000 What is the IRR for this project? If the required return is 12%, should the firm accept the project? What is the NPV of this project? What is the NPV of the project if the required return is 0%? 24%? What is going on here? Explain your answer

Q: Consider the following cash flow profile and assume MARR is 10%/yr. Solve, a. What does Descartes’…

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A: To open the "NPV function" window - MS-Excel --> Formulas --> Financials --> NPV.

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A: Year Cash flow 0 -81100 1 21500 2 25000 3 30800 4 26000 5 19800 Required return = 14%

Q: question 2

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A: NPV: It stands for Net Present value. It is the difference between PV (Present value) of cash…

Q: Consider the following cash flow profile and assume MARR is 10%/yr. Solve, a. What does Descartes’…

A: A project may have multiple IRRs if there are variation in cash inflows and outflows. If there are…

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A: The calculation is shown as:

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A: PB Period refers to the time in which the company could cover the amount invested in the project.

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A: Formulas:

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A:

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Q: What is the project's payback

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A:

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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.