Which shows the discounted payback period at an interest rate of 15% for eachproject for each project?TABLE P≤ 6Project's Cash Flow ($)nBCD0-$3,800-$5,200-$3,800-$2,80010$2,200-$1,600-$80020$3,800$6,700-$,60030$4,400$6,800$9,4004$12,500$3,600$6,900$8,800O 3.40, 1.99, 3.92, 3.25O 3.70, 2.05, 3.92, 3.25O 3.40, 1.67, 3.18, 2.60O 3.70, 1.99, 3.66, 3.2513

Step 1:Discounted Payback period takes into account time value of money to calculate the time it…

Answered: Which shows the discounted payback…

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter9: Capital Budgeting Techniques

Section: Chapter Questions

Problem 13PROB

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Project B cost $5,000 and will generate after-tax net cash inflows of $500 in year one, $1,200 in year two, $2,000 in year three. $2,500 in year four, and $2,000 in year five. What is the NPV using 8% as the discount rate? For further instructions on net present value in Excel, see Appendix C.
How much would you invest today in order to receive $30,000 in each of the following (for further Instructions on present value In Excel, see Appendix C): A. 10 years at 9% B. 8 years at 12% C. 14 years at 15% D. 19 years at 18%
Redbird Company is considering a project with an initial investment of $265,000 in new equipment that will yield annual net cash flows of $45,800 each year over its seven-year life. The companys minimum required rate of return is 8%. What is the internal rate of return? Should Redbird accept the project based on IRR?
Project X costs $10,000 and will generate annual net cash inflows of $4,800 for five years. What is the NPV using 8% as the discount rate?
Project Y cost $8,000 and will generate net cash inflows of $1,500 in year one, $2,000 in year two, $2,500 in year three, $3,000 in year four and $2,000 in year five. What is the NPV using 8% as the discount rate?
EQUIVALENT ANNUAL ANNUITY A firm has two mutually exclusive investment projects to evaluate. The projects have the following cash flows: Time Cash Flow X Cash Flow Y 0 (80,000) (75,000) 1 40,000 35,000 2 60,000 35,000 3 70,000 35,000 4 _ 35,000 5 _ 5,000 Projects X and Y are equally risky and may be repeated indefinitely. If the firms WACC is 10%, what is the EAA of the project that adds the most value to the firm? (Round your final answer to the nearest whole dollar.)
Project A costs $5,000 and will generate annual after-tax net cash inflows of $1,800 for five years. What is the NPV using 8% as the discount rate?
Assume that an investment of 100,000 produces a net cash flow of 60,000 per year for two years. The discount factor for year 1 is 0.89 and for year 2 is 0.80. The NPV is a. 0 b. 6,800 c. 1,400 d. (4,000)
How much would you invest today in order to receive $30,000 in each of the following (for further instructions on present value in Excel, see Appendix C): A. 20 years at 22% B. 12 years at 10% C. 5 years at 14% D. 2 years at 7%
if the cash flow for project Z are C0= -1,000, C1= 600, C2= 720, C3= 2,000 calculate the discounted payback period for the project at a discount rate of 20%
Given the following cash flows for project Z: C0 = -1,000, C1 = 600, C2 = 720 and C3 = 2000, calculate the discounted payback period for the project at a discount rate of 20%
The following information regarding an investment project is available. Discount rate 7% Year Cash Flow 0 (£125,000) 1 £60,000 2 £50,000 3 £10,000 4 £10,000 5 £50,000 A). What is the Net Present Value of the Project? Choose one from the following: A. £56,076 B. £43,670 C. £125,000 D. £26,188

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