Find the NPV of the project using the FTE method.

You are considering opening a new plant. The plant will cost $95.1 million up front and will take one year to build. After that it is expected to produce profits of $31.8 million at the end of every year of production. The cash flows are expected to last forever. Calculate the NPV of this investment opportunity if your cost of capital is 7.6%. Should you make the investment? Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged. The NPV of the project will be $ million. (Round to one decimal place.)

NPV and IRR Benson Designs has prepared the following estimates for a long-term project it is considering. The initial investment is $41,150, and the project is expected to yield after-tax cash inflows of $9,000 per year for 7 years. The firm has a cost of capital of 8%. a. Determine the net present value (NPV) for the project. b. Determine the internal rate of return (IRR) for the project. c. Would you recommend that the firm accept or reject the project? a. The NPV of the project is $. (Round to the nearest cent.) Text dia Librai I Calculat Resource Enter vour answer in the answer box and then click Check Answer. Check Answer ic Study es Clear parts remaining nunication Tools > O Type here to search insert ( to |立

A project will have an initial investment requirement of $5,000. Then, it will generate 5 years of $1,000 per year, with all cash expected to be received at the end of the year. The discount rate is 10%. The hurdle rate is the same as the discount rate, 10%. 9.What is the NPV? 10.What is the Payback? 11.What is the IRR. 12.Do you accept this project? 13.At WHAT HURDLE RATE would the project result in an NPV of exactly $0?

What is the NPV of a project that costs $38,000 today and is expected to generate annual cash inflows of $9,000 for the next 7 years, followed by a final inflow of $15,000 in year 8. Cost of capital is 7.4%. Round to the nearest cent.

A new project will have an intial cost of $15,000. Cash flows from the project are expected to be $4,000, $6,000, and $8,000 over the next 3 years, respectively. Assuming a discount rate of 10%, what is the project's IRR?

Your firm is considering a project that will cost $4.59 million up front, generate cash flows of $3.52 million per year for 3 years, and then have a cleanup and shutdown cost of $6.01 million in the fourth year. a. How many IRRS does this project have? b. Calculate a modified IRR for this project assuming a discount and compounding rate of 9.9%.

We are examining a new project. We expect to sell 6,000 units per year at $74 net cash flow apiece for the next 10 years. In other words, the annual cash flow is projected to be $74 × 6,000 = $444,000. The relevant discount rate is 18 percent, and the initial investment required is $1,710,000. After the first year, the project can be dismantled and sold for $1,540,000. Suppose you think it is likely that expected sales will be revised upward to 9,000 units if the first year is a success and revised downward to 4,600 units if the first year is not a success.   a. If success and failure are equally likely, what is the NPV of the project? Consider the possibility of abandonment in answering. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the value of the option to abandon? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

A new machine will cost $400,000 and generate after-tax cash inflows of $50,000 for 12 years. Find the NPV if the firm uses a 11% opportunity cost of capital. What is the IRR? What is the payback period? (5’)

Project Z has an initial after-tax cost of $500,000. The project is expected to produce after-tax CFs of $100,000 at the end f each year for the next five years, and has a WACC of 12%. There's a 10% probability that the project will to growth opportunities that have an NPV of 3m at t = 5 and a 90% probability of an NPV of -1,200,000 at t = 5 Is it feasible for the company to expand the project after 5 years?