EBK PRINCIPLES OF MANAGERIAL FINANCE
15th Edition
ISBN: 8220106777916
Author: SMART
Publisher: YUZU
expand_more
expand_more
format_list_bulleted
Question
Chapter 5, Problem 5.37P
Summary Introduction
To calculate: Cash flow.
Introduction:
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
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
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
1
$
1,375
2
1,495
3
1,580
4
1,630
If the discount rate is 8 percent, what is the future value of the cash flows in year 4?
If the discount rate is 11 percent, what is the future value of the cash flows in year 4?
If the discount rate is 24 percent, what is the future value of the cash flows in year 4?
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...
Knowledge Booster
Similar questions
- 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?arrow_forwardYear Cash Flow 0 –$ 17,700 1 10,000 2 8,900 3 5,400 a. What is the profitability index for the set of cash flows if the relevant discount rate is 11 percent? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b. What is the profitability index for the set of cash flows if the relevant discount rate is 16 percent? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) c. What is the profitability index for the set of cash flows if the relevant discount rate is 23 percent? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.)arrow_forwarduse excel 8. A project’s cash flows are listed below. Assume the appropriate discount rate for this project is 14%. The profitability index for this project is closest to ________. Year Cash Flow 0 -8000 1 3200 2 3200 3 3200 4 3200 (a) 0.17 (b) 0.25 (c) 0.66 (d) 0.18arrow_forward
- SUBJECT: ENGINEERING ECONOMICS INSTRUCTION: Answer the following questions by including the appropriate cash flow diagrams, solution, and final answer. 1. You are planning to save enough money to buy a brand new car five years from now. You are setting a budget of Php 1,000,000 for this purchase. Your plan is to accumulate the amount by making three savings deposits at an interest rate of 10%. Deposit 1: Deposit Php 100,000 today, Deposit 2: Deposit Php 150,000 two years from now, Deposit 3: Deposit an amount Php X three years from now. How much do you need to invest in year three to ensure that you have the necessary fund to buy the new car at the end of year five?arrow_forward6. A report from the marketing department indicates that a new product will generate the following revenue stream: P62,500 in the first year, P89,400 in year two, P136,200 in year three, P128,300 in year four, and P112,000 in year five. If your firm's discount rate is 11% and the cash flows are received at the end of each year, what is the present value of this cash flow stream? a.P379,435.35b.P421,173.24c.P476,036.04d.P528,400.00arrow_forwardSUBJECT: ENGINEERING ECONOMICS (a) Identify the Given and the Unknown or what is being asked in the problem (b)Provide the formula to be used (c)Show the complete solution. The final answer is already provided. What is the value of a perpetuity of P100 per year if the discount rate is 5% and the cash flows do not begin until two years from now? Answer: P = P1,814.05arrow_forward
- Question content area top Part 1 (Present value of complex cash flows) How much do you have to deposit today so that beginning 11 years from now you can withdraw $ 8,000 a year for the next 5 years (periods 11 through 15) plus an additional amount of $ 16,000 in the last year (period 15)? Assume an interest rate of 5 percent. Question content area bottom Part 1 The amount of money you have to deposit today is $ enter your response here . (Round to the nearest cent.)arrow_forwardGiven information: Initial Investment = $20,000 Yearly Cash Flows = $5000 Time = 5 years Discount rate = 6% Can you please use excell formulas to show at what discount rate is the net present value "0"...I am not sure which function to use. Thank you!arrow_forwardYear Cash Flow 0 –$ 17,200 1 9,500 2 8,400 3 4,900 a. What is the profitability index for the set of cash flows if the relevant discount rate is 10 percent? b. What is the profitability index for the set of cash flows if the relevant discount rate is 15 percent? c. What is the profitability index for the set of cash flows if the relevant discount rate is 22 percent?arrow_forward
- What is the most you should pay to receive the following cash flows if your required rate of return is 10 percent? Year 1-3 $5,000 Year 4-6 Year 7-9 Years 10 $46,878.34 O $50,009.84 $40,639.31 $55,687.75 $52,439.73 $47,202.31 $8,000 $12,000 $15,000arrow_forwardHow do you calculate the NPV and IRR Project 1 Year Cashflows Discount Rate 10% 0 $ (750,000.00) 1 $ 250,000.00 2 $ 300,000.00 3 $ 350,000.00 4 $ 200,000.00 5 $ 100,000.00 Project 2 Year Cashflows Discount Rate 10% 0 $ (1,000,000.00) 1 $ 200,000.00 2 $ 300,000.00 3 $ 400,000.00 4 $ 500,000.00 5 $ 700,000.00arrow_forwardQUESTION-1 Consider the following cash flow and calculate the rate of return. MARR is 5%, compounded annually. Year 0 1 2 3 4 5 6 7 8 Cash -25,000 6,000 4,000 5,000 7,000 -20,000 ,12,000 16,000 20,000 pls reply urgentarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Essentials Of InvestmentsFinanceISBN:9781260013924Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.Publisher:Mcgraw-hill Education,
Foundations Of FinanceFinanceISBN:9780134897264Author:KEOWN, Arthur J., Martin, John D., PETTY, J. WilliamPublisher:Pearson,
Fundamentals of Financial Management (MindTap Cou...FinanceISBN:9781337395250Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i...FinanceISBN:9780077861759Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan ProfessorPublisher:McGraw-Hill Education
Essentials Of Investments
Finance
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:9780134897264
Author:KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:Pearson,
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i...
Finance
ISBN:9780077861759
Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:McGraw-Hill Education