What is the criteria to accept a project based on the net present value and the internal rate of return

Q: SLO-5.3. The ease with which an investment can be converted into cash is called * Oprofitability…

A: Investment means engaging your funds to generate income for the future. Basically there are two…

Q: You own all the equity of R.G.C. I Ltd. The company has no debt.  The company’s annual cash flow is…

A: Here, Annual cash flows (EBIT) = GH¢900,000 Tax rate = 35% Exchange of equity = 1/2 5% bonds =…

Q: Today's dividend yield for standard supply is computed by utilizing the formula C = A/S where A is…

A: A stock's dividend yield is a calculation of the investment's dividend-only return. The yield will…

Q: Morty is looking into buying an apartment. He checked out a few places recently, and it looks like…

A: The answer is Yes. Morty is ready to buy that apartment.

Q: Nominal annual interest rates are 7.3%. If a businessperson has an opportunity to invest $40,000…

A: Option 1: If 40,000 invested at 7.3% for 5 years: Future Value = Present Value * ( 1 + Interest…

Q: Sam is buying a refrigerator. He has two choices. A used one, at $475, should last him about three…

A: Explanation : If we have two option and same provide the positive NPV then we should select that…

Q: 8-9. You want to have $750,000 on your 70th birthday, and you are 25 right now. 8) What lump sum…

A: Compounding is a technique which is used to compute the future value (FV) of present amount by using…

Q: MV Corporation has debt with market value of $100 million, common equity with a book value of $97…

A: To Find: Weight of debt Weight of equity Weight of preferred stocks

Q: Your factory has been offered a contract to produce a part for a new printer. The contract would…

A: Net Present Value(NPV) is one of the modern techniques of capital budgeting which considers the time…

Q: Consider the following term structure of interest rates: Maturity Interest Rate 1-year 4.6% 2-year…

A: Forward rates are the rates that would be applicable after a specified number of years, whereas spot…

Q: a. Calculate the price-earnings ratio in 2023 and 2024. b. In which year is the stock priced lower…

A: Price-Earnings Ratio: It is a financial ratio that is used in valuing the firm and measures the…

Q: You plans to withdraw $150,000 at the end of every year from this accout.To prevent overwithdrawal…

A: First requirement is to calculate the Return of amount in risky fund which will be Invested in…

Q: You borrow $11,000 from the bank at an interest rate of 6%, compounded annually. You are required to…

A: Compound interest is interest added to the principal amount of a loan or deposit, or interest on…

Q: 5) Determine the present value at time 0 of payments of $1,000 at the start of each month for 5…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: DeWayne has two credit cards, which he uses to pay for everything. DeWayne does not check his credit…

A: It is quite necessary and important to pay the debt on time and get out of debt.

Q: Floating Homes, Inc., is a manufacturer of luxury pontoon and houseboats that sell for $40,000 to…

A: Expected revenue will be computed on the basis of the given probabilities and expected unit sales…

Q: Suppose a customer has to pay a total amount of PhP 20,676 as a payment of a personal loan at the…

A: Solved using Financial Calculator  FV = 20,676 N = 3.5 * 4 = 14 I/Y = 4/4 = 1  CPT PV = 17,987.35

Q: Suppose a customer has to pay a total amount of PhP 20,945 as a payment of a personal loan at the…

A: Present Value refers to the discounted value of a single cash flow or multiple cash flows today…

Q: that currently has 100 units of capital, and their desired level a epreciation rate is 10%, how much…

A: For a company units of capital is an essential input factor. Units of capital along with labor are…

Q: Cost of Equity with and without Flotation Jarett & Sons’s common stock currently trades at $30.00 a…

A: Cost of Equity without floatation cost: Given, Next Year's Dividend = 1 Share Price = 30 Growth = 4%…

Q: Caddie Manufacturing has a target debt-equity ratio of .75. Its cost of equity is percent, and its…

A: The cost of capital is the rate of return that a company gives on all its capital whether it is…

Q: Determine the increase or decrease in cash for last year given the following information. Net income…

A: Solution: Cash flow means the cash generated or paid during a period by a firm.

Q: The bank statement of ABC Corp disclosed a cash balance of P687,000 at Dec 31. Additional…

A: A bank reconciliation statement is prepared at the end of an accounting period to identify the…

Q: Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used…

A: Concept. Variable expenses change with change in number of units. However , fixed expenses do not…

Q: SLO-5.1. Debby Martin has assets valued at $120,000 and liabilities that total $50,000. Based on…

A: Shareholders/ Owner’s equity: The shareholders are the owners of the company and the shareholders…

Q: Alpha Resources has sales revenue of $800,000, operating costs of $400,000, and depreciation expense…

A: Sales = $800,000 Operating cost = $400,000 Depreciation = $20,000 Bonds = $300,000 Interest rate =…

Q: On May 6, May Payment makes a purchase of $258.50 on her credit card. The purchase appears on her…

A: A credit card is a pay later facility where banks pay on behalf of customers at the time of purchase…

Q: 4. Batman Products Inc. manufactures two items, masks and capes. Each item passes down two assembly…

A: In this finance question we have to find the product mix so that revenue will be maximized. Here the…

Q: What are the benefits to the back for amortizing a loan

A: In finance amortized loan is one in which fixed monthly payments are made by the borrower to the…

Q: Mr. Tuskegee believes the common stock price of ABC Materials (currently $58 per share) could move…

A: Current Stock price is $58 Call option with strike price $60 has premium of $4 Put option with…

Q: On December 31, 2017, Jackson Company had 100,000 shares of common stock outstanding and 24,000…

A: Answer-  Part 1 - Computation of Basic Earnings per share- Income after 7% dividend on cumulative…

Q: Inflation and unemployment are twin problems that every government attempts to address. Elucidate…

A: Inflation is the decline in the purchasing power of a currency over time. By tracking the average…

Q: How much money should be set aside today to provide an income of PHP 11,200 a month for 4 years if…

A: Monthly payment (C) = PHP 11,200 Number of payments (n) = 48 (4 Years * 12) Monthly interest rate…

Q: SLO-5.2. The act enacted to improve corporate accountability and financial reporting is the…

A: The Government passes various acts to increase the confidence of investors in corporations and in…

Q: If the market price for an option is lower than what the value is from using the binomial model what…

A: Options are contracts that provide the buyer the right, but not the responsibility, to buy or sell a…

Q: 1. Determine the weighted average number of shares outstanding for computing the current earnings…

A: Earnings per shares refers to the profit earned by each shareholder after paying all the expenses of…

Q: How long in years will a certain sum of money to triples its amount when deposited at a rate of 5%…

A: Interest rate = 5% Monthly interest rate (r) = 5%/12 = 0.416666666666667% Period = Y Years Number of…

Q: duration of this bond?

A: A zero-coupon bond has a price of $350 with a face value of $1,000. The maturity period is 9.55…

Q: Find the compound interest earned if PhP 31,496 is deposited in a bank at 2.6% compounded monthly…

A: Solved using Financial Calculator  PV = -31,496 N = 26 I/Y = 2.6/12 = 0.2167 CPT FV = 33,319.17

Q: Another of Matilda’s colleagues is looking at the yield curve and asks for an explanation as to why…

A: Biased expectation theory is defined as the theory of term structure of the rate of interest. In the…

Q: Suppose that a 10-year T-note is purchased with a face value of $20,000 and a coupon rate of 3.4%…

A: Return means an additional amount earned over the invested amount. It is computed on the basis of…

Q: Jason Corporation has invested in a machine that cost $80,000, that has a useful life of eight…

A: Given: Particulars Amount Initial cost $80,000 Use life 8 Payback period 5

Q: I. Find the value (using Binomial Tree) of a European style call option on an underlying stock which…

A: Options are derivatives. The value of option is derived from the value of an underlying asset.…

Q: 3. Timmy borrows $10,000 and agree to make annual payments for five years (beginning one year after…

A: Borrowed amount = $10,000 Interest rate = 0.07 First payment = $1,000 Second payment = $2,000 Third…

Q: Assume r=0.1. What is the present value of the following stream of cash flow? Year 0 Year 1 Year 2…

A: Present value is the discounted value of future cash flows associated with the project. It is the…

Q: . Ji-Hoon wants to get a $500,000 3% 30-year mortgage in order to buy his first home. How much…

A: Loan amount (PV) = $500,000 Interest rate = 3% Monthly interest rate (r) = 3%/12 = 0.25% Period = 30…

Q: Paranto company has the following Capital structure: 50% equity, 30% debt; and 20% preferred stock.…

A: Weighted average cost of capital(WACC) is the average cost of capital calculated by multiplying the…

Q: At what rate converted annually will make PhP 3,287 accumulate to PhP 3,969 in 4 years?

A: Here, Present Value is Php 3,287 Future Value is Php 3,969 Time Period is 4 years

Q: A) Brock purchases equipment that has a fair value of $50,000. Brock pays $10,000 as a downpayment,…

A: Fair Value of Equipment is $50,000 Downpayment is $10,000 Principal amount of note is $60,000 Annual…

Q: 21. Aluminum maker Alcoa has a beta of about 1.9, whereas Hormel Foods has a beta of 0.37. If the…

A: First, we will calculate the Cost of Equity by applying the required formula for both companies and…