Don't reject....Question is complete.Same type of question all ready solved in your app. Nu Things, Inc., is considering an investment in a business venture with the following anticipated cash flow results:EOY Cash Flow-$90,000$21,0002.$20,0003$19,0004.$18,000$17,0006.$16,000$15,0008.$14,000$13,00010$12,00011$11.00012$10,00013$9,00014$8.00015$7,000Question 5 of 516$6.00017$5,00018$4,00019$3,00020$2,000 Assume MARR is 20% per year. Based on an external rate of return analysis:Click here to access the TVM Factor Table CalculatorPart aDetermine the investment's worth.Carry all interim calculations to 5 decimal places and then round your final answer to 1 decimal place. The tolerance is 10.2

Investment’s worth means the benefit which an investor is going to receive from the amount invested.…

Answered: Nu Things, Inc. is considering an…

Nu Things, Inc. is considering an investment in a business venture with the following anticipated cash flow resul EOY Cash Flow -$90,000 $21,000 $20,000 3. $19,000 $18,000

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

If a company is expected to generate annual cash flow of $500,000 and has a WACC of 12.5%, then the value of this company is Select one: $4,000,000 $62,500 $444,444 $500,000
Shrewd Endeavors, Inc., invested $70,000 in a business venture with the following cash flow results: MARR is 10%. Determine the external rate of return and whether or not this is a desirable venture.
Wonder Plc is considering two investment projects in another city and theestimated cash flows are as follows:Year Hotels Housing£ (m) £ (m)0 Capital outlay (200) (250) Net cash flows1 130 1302 60 1203 80 1204 100 804 Residual value 20 40The company’s cost of capital is 15%.Required: (b) Explain the importance of Payback period to the CEO.
The management of Unter Corporation, an architectural design firm, is considering an investment with thefollowing cash flows:Year Investment Cash Inflow1 ......................... $15,000 $1,0002 ......................... $8,000 $2,0003 ......................... $2,5004 ......................... $4,0005 ......................... $5,0006 ......................... $6,0007 ......................... $5,0008 ......................... $4,0009 ......................... $3,00010 ......................... $2,000Required:1. Determine the payback period of the investment.2. Would the payback period be affected if the cash inflow in the last year were several timesas large?
Assume your organization wishes to make a Php 200,000 investment with a private equity firm in 2021. Taking into account all of the risks, the current discount rate is 12%, and the revenue stream/dividends are as follows: 2022 50002023 60002024 70002025 80002026 90002027 100002028 11000 Determine the following:a. NPV for the period 2022 through 2028;b. Total NPV using manual computation;c. Total NPV using the Excel function; andd. IRR rate.
Your employer, Rubio LLC, is considering an investment in an office building that has the following cash flows: Purchase in Year 0…………… $ -2,750,000 Year 1………………. 220,000 Year 2……………….. 226,000 Year 3……………….. 250,000 Year 4………………… 255,000 Year 5 ………………… 230,000, and a sale @ $3,290,000 takes place EOY 5 The company’s weighted average cost of capital that they use as their discount rate for such calculations is 12% What would be the total cash flows in Year 5, taking into consideration the cash flows, annual debt service, sale price and the balance on the loan at the EOY 5? $1,662,985 $1,937,607 $1,802,986 $1,343,455 What is the leveraged IRR of the project ? 64% 58% 48% 55% In the above problem, you might expect The Yield to be higher than the discount rate because you sold the property at a profit. The NPV to be positive because the IRR is higher than the discount rate The NPV to be negative because the IRR is lower than the discount rate All of the…
A company is considering an investment where the estimated cash flows are as follows: Year Cash Flow 0 (100000) 1 60000 2 80000 3 40000 4 30000 The company cost of capital is 13%. What is the NPV? 51800 61871 56800 122000 51000
Assume your organization wishes to make a Php 200,000 investment with a private equity firm in 2021. Taking into account all of the risks, the current discount rate is 12%, and the revenue stream/dividends are as follows: 2022 50002023 60002024 70002025 80002026 90002027 100002028 11000 Determine the following: DO IT IN EXCELa. NPV for the period 2022 through 2028;b. Total NPV using manual computation;c. Total NPV using the Excel function; andd. IRR rate.
Shaylee Corp has $2.00 million to invest in new projects. The company’s managers have presented a number of possible options that the board must prioritize. Information about the projects follows: Project A Project B Project C Project D Initial investment $ 434,000 $ 249,000 $ 739,000 $ 964,000 Present value of future cash flows 784,000 434,000 1,219,000 1,579,000 Required: 1. Is Shaylee able to invest in all of these projects simultaneously? 2-A. Calculate the profitability index for each project. 2-B. What is Shaylee’s order of preference based on the profitability index?
Sunshine Corporation is reviewing an investment proposal. The initial cost of the investment is R52 500. The estimated cash flows and net profit for each year are presented in the schedule below. All cash flows are assumed to take place at the end of the year. Year Net cash flows Net profit1 R20 000 R2 5002 R17 500 R3 5003 R15 000 R4 5004 R12 500 R5 5005 R10 000 R6 500 The cost of capital is 12%.Required:Calculate the following:1. Payback Period 2. Net Present value 3. Accounting rate of return
A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be repeated) with the following cash flows: 0 1 2 3 4 5 6 7 Project A -$300 -$387 -$193 -$100 $600 $600 $850 -$180 Project B -$405 $131 $131 $131 $131 $131 $131 $0 The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. What is each project's NPV? Round your answer to the nearest cent. Do not round your intermediate calculations. Project A: $ Project B: $ What is each project's IRR? Round your answer to two decimal places. Project A: % Project B: % What is each project's MIRR? (Hint: Consider Period 7 as the end of Project B's life.) Round your answer to two decimal places. Do not round your intermediate calculations. Project A: % Project B: % From your answers to parts a-c, which project would be selected? _________Project…
Based on the investor expectations of earning at least 12%, should this projected below be completed? Year 0 1 2 3 4 5 6 Cash Flow (133,000) 37,000 42,750 44,000 46,500 82,500 77,000 Please explain why or why not the company should move forward with this endeavor.

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