2 Net cash flow-20,0001340,000IRRPW(15%)What is the value of IRR?6,300Select one:O 15%O 18%23%O 30%O 26%

Internal rate of return is the rate at which the present value of cash inflows are equals to the…

Answered: in Net cash flow 20,000 40,000 IRR…

Business

Finance

in Net cash flow 20,000 40,000 IRR PW(15%) What is the value of IRR? 6,300 Select one: O 15% O 18% O 23% O 30% O 26%

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter14: Security Structures And Determining Enterprise Values

Section: Chapter Questions

Problem 8EP

See similar textbooks

Related questions

Q: Compute the rate of return represented by the cash flow. Year Cash Flow -S20, 000 6, 000 6, 500 3 7,…

A: In order to determine the profitability the rate of return is used by the management, it helps to…

Q: What is the present value of the following cash flow at a 12% discount rate?…

A: Present value is calculated using the discounting factor of Rate @ 12%

Q: 3) Net Cash Flow -$30,000 +S3,000 +$4,050 +$5,100 +$6,150 +$11,250 +$6,000 +$7,200 +S8,640 EOY 2 3 5…

A: The present worth is the current worth of all cash flow that has to be paid or received in the…

Q: 24) What is the present value of the following set of cash flows, discounted at 10.3% per year? Year…

A: The purchasing value of money reduces over time. This reduction in the purchasing power of money is…

Q: 1. Compute the net present value at i=15% per year, compounded annually, for cash flow below: End of…

A: Note : As per the guidelines, only first question will be answered. Kindly post the remaining parts…

Q: Refer to the following cash flow diagram. If / 12% per year, what is P, when N- o0? 1234 EOY P A…

A: When N = Infinite, we are dealing with perpetuity

Q: Year Cash Flow 0 –$ 17,700 1 10,000 2 8,900 3 5,400 a. What is the…

A: The formula to compute profitability index:

Q: Compute for the value of x so that the two cashflows will be equivalent. 5X .. 1400 2800 2100 AX 700…

A: This question is based on present value concept. Present value is given by PV = C/(1+r)n Where C =…

Q: Insurance costs 2 millon Increase in working capital 5 milion OSM Fees 3milion Interest Expenses…

Q: The down payment or equity needed for this investment is $60,000 (outflow) Cash Flow $15,000 5,000…

A: Investment $ 60,000.00 Saving Rate 1.50% Loan Rate 8%

Q: 6. Determine the equivalent present worth in year 0 (PT) of all of the cash flows at i = 12% per…

A: Data given: i= 12% Initial cash flow in year 0 = $30000 Annual cash flow from year 1 to 3 = $5000…

Q: At a rate of 10.0%, what is the future value of the following cash flow stream? Years: 1 4 CFs: $0…

A: Future value is the future worth of cash flows that has occurred in the past or present.

Q: What is the net present value of the following set of cash flows at a discount rate of 5 percent? at…

A: Net Present Value(NPV) is excess of PV of inflows over PV of outflows that is computed by…

Q: Compute for the value of x so that the two cashflows will be equivalent. ... 2800 1400 AX 700 3X メ 4…

A: The PV of cashflow = C/(1+r)N Where C = cashflows r = interest rate = 10% N = time of cashflows…

Q: What is the present value of the following set of cash flows, discounted at 15.5% per year? Year 1…

A: Present value is the current worth of the future cash flows at a given interest rate.

Q: Question attached

A: Net Present Worth is the sum of present value of future cash flows.

Q: What is the present value of the following set of cash flows, discounted at 15.7% per year? Year 1 4…

A: Present value is calculated by discounting the future cash flow at the given discount rate.…

Q: Given the cashflow tabulated below. What is the payback period using the discounted method at…

A: Discounted payback period is the most common capital budgeting technique which aims to ascertain…

Q: Total cash inflows $325,000 Measure the Payback Period for this in

A: The payback period is the amount of time it takes to repay the cost of an investment.Simply said,…

Q: $27,300.00

Q: Year Cash Flow $275.000 1 $35,000 2 $65.000 36 $95.000 $135.000 $185.000 9-20 $245,000 Given the…

A: The Payback period is one of the capital budgeting techniques that do not take into account the…

Q: IRR factor: Initial investment / Annual net cash flow = RM 253,000 / RM 282,050 = 0.90 From the…

A: Investment or project appraisal means to decide whether a particular investment or project should be…

Q: Determine the present equivalent value of the cash-flow diagram shown below P = ? $5,000 $3500 8% iz…

A: The worth of the money changes according to time. Therefore, the time value of money shows the worth…

Q: The down payment or equity needed for this investment is $60,000 (outflow) Cash Flow $15,000 5,000…

A: MIRR: By assuming that profits are reinvested at the company's cost of capital and that cash…

Q: Transaction cost Rs 625 per transaction, Holding cost 9.6% p.a. Quarterly cash usage Rs. 12,00,000.…

A: Transaction cost per transaction is Rs 625 Holding cost per annum is 9.6% Quaterly holding cost is…

Q: Consider the following cash flow diagram. Compute the equivalent annual worth at i-12% $5,000 $6,000…

A: Cash-Flow diagram depicts amount of cash that is either received (inflows) or paid (outflows) over…

Q: Calculate: Profits before and after taxes Change in cash EBITD Coverage ratio REVENUE…

A: Given: REVENUE =400,000 OPERATING COSTS = 250,000 DEPRECIATION = 25,000 INTEREST = 20,000 Tax rate =…

Q: What is the present value of the following set of cash flows, discounted at 15.8% per year? Year 1 3…

A: The present value method is a method of finding the profitability of a project by discounting cash…

Q: F10 - 8% B B. B B B. |= 6.5 % 0 1 2 3 4 5 6 7 8 9 10 1 12 18 19 20 // A A A A 100,000

A: If the deposits are made on the time they grow with time bigger amounts and than they retuned into…

Q: What value of T makes these two cash-flow diagrams economically equivalent at 8% annual interest?

Q: 34,000 Total cash payments Ending cash balance before fi nancing (3,500) Minimum cash balance…

A: A cash budget is a budget or set up of expected money receipts and disbursements throughout the…

Q: Net Cash Flow -530,000 +S3,000 +54,050 +55,100 +S6,150 +S11,250 +$6,000 +S7,200 +$8,640 EOY 2 8 For…

A: Capital Budgeting: Capital budgeting decisions are the most important decision in corporate…

Q: 3. Refer to the following table of cash flows: End of Year (EOY) Cash Flow 8 12 16 P5,000 P5,000…

A: Annual worth assessments are substantially the same as present worth comparisons, with the exception…

Q: Income from Net Cash Year Operations Flow $100,000 $180,000 2 40,000 120,000 40,000 100,000 10,000…

A: Net present Value (NPV) is the contrast between the current estimation of money inflows and the…

Q: Find the ROR of the following cash flow. MARR is 18% per year. Year 0 1 3 4 5 7 8 Cash -32,000…

A: The ROR is the interest rate that results in net present worth(NPW) of project zero. It can be…

Q: Consider the following cash flows: Year Cash Flow 532,000 14,200 17,500 11,600 What is the IRR of…

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: 18. What is the NPV of the following cash flows? The company uses an 11% discount rate. ($168,000)…

A: Formulas:

Q: What amount of cash must be invested today in order to have $60,000 at the end of one year assuming…

A: The question is based on the concept of Financial management.

Q: For the value of P shown, what is the NPV for the cashflow? Value of P S1,000 Rate 5% Year Cash Flow…

A: NPV is calculated as the difference of present value of inflows and outflows associated with the…

Q: 15) The cash flows for three mutually exclusive alternatives are given in table below. MARR = 4%.…

A: ROR or rate of return is the return which is hidden in the cashflows of an investment, it is…

Q: Flujo neto de $9500 Calculate the NPV Calculate the Payback Cashflow Cash Flow Nominal Value (SIN…

A: Net present value (NPV) is the contrast between the present value of money inflows over some…

Q: Calculate the equivalent AW at i 10% per year for the following net cash flow: Year Cash flow, $…

A: Given: Year Cash flows 0 1 -$2,000.00 2 -$2,000.00 3 -$2,000.00 4 $5,000.00 5…

Q: rom the following data, calculate Internal Rate of Return ((RR): Vear Cash Flow 384,000) Rs)…

A: Internal Rate of Return is the discounting rate where the net present value of the project is zero.

Q: Net Cash Flow -$30,000 +$3,000 +$4,050 +$5,100 +$6,150 +$11,250 +$6,000 +S7,200 +$8,640 ΕΟΥ 1 2 3 4…

A: Net Present Value is the difference between the current value of cash inflow and cash outflow for a…

Q: $20,000 now is equivalent to cash flows worth 5X at the end of year 3, 4X at the end of year 4, 3X…

A: present value of each cash flow = cash flow/(1+rate)^n

Q: For the cash flows shown (in $1000 units), calculate the value of x that makes the present worth in…

A: The present value of a cash flow represents the worth of money at present time. It is also known as…

Concept explainers

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

Net cash flow
-20,000
1
3
40,000
IRR
PW(15%)
What is the value of IRR?
6,300
Select one:
O 15%
O 18%
23%
O 30%
O 26%

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

What is the present value of the following cash flow stream at a rate of 15.0%? Years: 0 1 2 3 4 CFs: $0 $1,500 $3,000 $4,500 $6,000 Select one: a. $10,261 b. $12,453 c. $12,154 d. $10,859 e. $9,962
ind the IRR for the following cash flows assuming a WACC of 10%. YR CF 0 -15,000 1 6,000 2 4,000 3 2,000 4 3,000 5 2,000
What is the present value of the following cash flow stream at a rate of 10.0%? Years: 0 1 2 3 CFs: $750 $2,450 $3,175 $4,400 a. $10,755.00 b. $13,143.15 c. $11,855.25 d. $9,722.73 e. $8,907.02
Project MM has the following cash flows:End-of-Year Cash Flows ---------------------------------0 1 2 32$1,000 $2,000 $2,000 2$3,350Calculate MM’s NPV at discount rates of 0%, 10%, 12.2258%, 25%, 122.1470%,and 150%. What are MM’s IRRs? If the cost of capital is 10%, should the project beaccepted or rejected?
Find the NPV for the following cash flows assuming a WACC of 10%. YR CF 0 -15,000 1 6,000 2 4,000 3 2,000 4 3,000 5 2,000
From the following data, calculate internal rate of return (IRR) Year Cash Flow(Rs) 0 (3,84,000) 1 1,50,000 2 1,25,000 3 1,00,000 4 75,000 5 55,000
23. Simms Corp. is considering a project that has the following cash flow data. The project's IRR is_______ %. Show 2 decimals in your answer. Year 0 1 2 3 Cash Flows -$1,000 $380 $475 $450
What is the present value of the following cash flow stream at a rate of 12.0%? Years: 0 1 2 3 4 | | | | | CFs: Php0 Php1,500 Php3,000 Php4,500 Php6,000 Php9,699 Php10,210 C. Php10,747 D. Php11,284 Php11,849
Assuming today is 1st January 2021. Date Cash flows (Rs.) 01-Jan-21 (900,000 ) 31-Dec-21 0 31-Dec-22 240,000 31-Dec-23 320,000 31-Dec-24 490,000 31-Dec-25 250,000 31-Dec-26 345,000 Cost of Capital = 8% Required: Net Present Value (NPV) Payback period (Simple and discounted) Internal Rate of Return (IRR) Solve At Excel.
IRR factor: Initial investment / Annual net cash flow = RM 253,000 / RM 282,050 = 0.90 From the annuity table, this factor corresponds to 2% discount rate which produces the same value which means that at this rate, the present value of cash flows equal the initial investment. So, the IRR is 2% Machine RMR: IRR factor: Initial investment / Annual net cash flow = RM 195,000 / RM 321,120 = 0.61 From the annuity table, this factor corresponds to 10% discount rate which produces the same value which means that at this rate, the present value of cash flows equal the initial investment. So, the IRR is 10% Which IRR is better?
Year Cash inflow (R) 3 45 000 6 90 000 9 115 000 The applicable interest rate is 11,59% per year. The present value of the cash outflows is R95 000 The future value of the cash inflows is approximately [1] R326 950. [2] R271 470. [3] R169 330. [4] R218 000. [5] R250 000
22.Harry's Inc. is considering a project that has the following cash flow and WACC data. The project's NPV is $ _________. (Show 2 decimals.) WACC = 10.25% Year 0 1 2 3 4 Cash Flows -$1,000 $100 $450 $450 $350