EBK PRINCIPLES OF MANAGERIAL FINANCE
15th Edition
ISBN: 8220106777916
Author: SMART
Publisher: YUZU
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Chapter 5, Problem 5.33P
Subpart (a)
Summary Introduction
To calculate: Present value of mixed stream.
Introduction:
Mixed stream: Mixed stream is an unequal periodic of cash flow.
Subpart (b)
Summary Introduction
To discuss: Comparison of present value of mixed stream A and B.
Introduction:
Mixed stream: Mixed stream is an unequal periodic of cash flow.
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Task 2A business has two projects to invest in, as follows:Create a new spread sheet, calculate NPV for the following projects at discount rates of 3% and 7%, respectively, by creating a dynamic process.
Project 1 Project 2Year Cash inflows Cash outflows Cash inflows Cash outflows0 0.00 70,000.00 0.00 70,000.001 24,000.00 13,000.00 25,000.00 15,000.002 22,000.00 1,000.00 25,000.00 03 25,000.00 0 20,000.00 04 25,000.00 0 43,000.00 21,000.005 17,500.00 7,500.00 20,000.00 5,000.00
P1: NPV P2: NPVThen, a) by using a built-in/Excel function, calculate the NPV for each project with discount rates of 3% and 7%, respectively;b) By comparing the NPVs at the rate of…
Year
Cash Flow
0
−$8,200
1
2,500
2
4,100
3
3,900
What is the profitability index for the cash flows if the relevant discount rate is 10 percent?
A. 1.079
B. 1.100
C. 0.995
D. 1.016
E. 1.048
What is the profitability index for the cash flows if the relevant discount rate is 16 percent?
A. 0.939
B. 0.967
C. 0.986
D. 0.892
E. 0.911
What is the profitability index for the cash flows if the relevant discount rate is 26 percent?
A. 0.795
B. 0.819
C. 0.834
D. 0.755
E. 0.771
Year Cash Flow 0 −$ 9,300 1 5,700 2 3,000 3 4,800 a. What is the profitability index for the cash flows if the relevant discount rate is 10 percent? b. What is the profitability index for the cash flows if the relevant discount rate is 16 percent? c. What is the profitability index for the cash flows if the relevant discount rate is 24 percent?
Chapter 5 Solutions
EBK PRINCIPLES OF MANAGERIAL FINANCE
Ch. 5.1 - What is the difference between future value and...Ch. 5.1 - Define and differentiate among the three basic...Ch. 5.2 - Prob. 5.3RQCh. 5.2 - Prob. 5.4RQCh. 5.2 - Prob. 5.5RQCh. 5.2 - Prob. 5.6RQCh. 5.2 - Prob. 5.7RQCh. 5.3 - What is the difference between an ordinary annuity...Ch. 5.3 - What are the most efficient ways to calculate the...Ch. 5.3 - How can the formula for the future value of an...
Ch. 5.3 - Prob. 5.13RQCh. 5.3 - What is a perpetuity? Why is the present value of...Ch. 5.4 - How do you calculate the future value of a mixed...Ch. 5.5 - What effect does compounding interest more...Ch. 5.5 - Prob. 5.21RQCh. 5.5 - Differentiate between a nominal annual rate and an...Ch. 5.6 - How can you determine the size of the equal,...Ch. 5.6 - Prob. 5.27RQCh. 5.6 - How can you determine the unknown number of...Ch. 5 - Learning Goals 2, 5 ST5-1 Future values for...Ch. 5 - Learning Goal 3 ST5-2 Future values of annuities...Ch. 5 - Prob. 5.3STPCh. 5 - Learning Goal 6 ST5-4 Deposits needed to...Ch. 5 - Assume that a firm makes a 2,500 deposit into a...Ch. 5 - Prob. 5.2WUECh. 5 - Prob. 5.3WUECh. 5 - Your firm has the option of making an investment...Ch. 5 - Joseph is a friend of yours. He has plenty of...Ch. 5 - Jack and Jill have just had their first child. If...Ch. 5 - Prob. 5.1PCh. 5 - Learning Goal 2 P5-2 Future value calculation...Ch. 5 - Prob. 5.4PCh. 5 - Prob. 5.5PCh. 5 - Learning Goal 2 P5- 6 Time value As part of your...Ch. 5 - Learning Goal 2 P5-7 Time value you can deposit...Ch. 5 - Learning Goal 2 P5-8 Time value Misty needs to...Ch. 5 - Learning Goal 2 P5- 9 Single-payment loan...Ch. 5 - Prob. 5.10PCh. 5 - Prob. 5.11PCh. 5 - Prob. 5.12PCh. 5 - Prob. 5.13PCh. 5 - Time value An Iowa state savings bond can be...Ch. 5 - Time value and discount rates You just won a...Ch. 5 - Prob. 5.16PCh. 5 - Cash flow investment decision Tom Alexander has an...Ch. 5 - Learning Goal 2 P5-18 Calculating deposit needed...Ch. 5 - Future value of an annuity for each case in the...Ch. 5 - Present value of an annuity Consider the following...Ch. 5 - Learning Goal 3 P5-21 Time value: Annuities Marian...Ch. 5 - Learning Goal 3 P5-22 Retirement planning Hal...Ch. 5 - Learning Goal 3 P5-23 Value of a retirement...Ch. 5 - Learning Goal 2, 3 P5-25 Value of an annuity...Ch. 5 - Prob. 5.26PCh. 5 - Prob. 5.30PCh. 5 - Learning Goal 4 P5-31 Value of a single amount...Ch. 5 - Value of mixed streams Find the present value of...Ch. 5 - Prob. 5.33PCh. 5 - Prob. 5.34PCh. 5 - Prob. 5.36PCh. 5 - Prob. 5.37PCh. 5 - Changing compounding frequency Using annual,...Ch. 5 - Prob. 5.39PCh. 5 - Prob. 5.40PCh. 5 - Compounding frequency and time value You plan to...Ch. 5 - Learning Goals 3, 5 P5-42 Annuities and...Ch. 5 - Prob. 5.43PCh. 5 - Prob. 5.44PCh. 5 - Prob. 5.45PCh. 5 - Prob. 5.46PCh. 5 - Prob. 5.47PCh. 5 - Loan amortization schedule Joan Messineo borrowed...Ch. 5 - Prob. 5.49PCh. 5 - Prob. 5.50PCh. 5 - Prob. 5.52PCh. 5 - Prob. 5.53PCh. 5 - Prob. 5.54PCh. 5 - Prob. 5.55PCh. 5 - Prob. 5.56PCh. 5 - Prob. 5.57PCh. 5 - Number of years needed to acccumulate a future...Ch. 5 - Prob. 5.59PCh. 5 - Prob. 5.60PCh. 5 - Time to repay Installment loan Mia Saito wishes to...
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