Question

What is the NPV of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming...

What is the NPV of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming an initial purchase price of $120,000 and discount rate of 5.75%?

Homework Answers

Answer #1
Year Cash Flow Discount factor Present Value
a b c=1.0575^-a d=b*c
0 $ -1,20,000.00      1.0000 $ -1,20,000.00
1 $       50,000.00      0.9456 $       47,281.32
2 $       30,000.00      0.8942 $       26,826.28
3 $       80,000.00      0.8456 $       67,647.05
NPV $       21,754.66
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
What is the NPV of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming...
What is the NPV of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming an initial purchase price of $120,000 and discount rate of 5.75%?
What is the IRR of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming...
What is the IRR of $50,000 year one, $30,000 year 2 and $80,000 year 3, assuming an initial purchase price of $120,000 and discount rate of 5.75%?
3. A project has an initial cost of $30,000 and a 3-year life. The company uses...
3. A project has an initial cost of $30,000 and a 3-year life. The company uses straight-line depreciation to a book value of zero over the life of the project. The projected average net income from the project is $1,766.67 per year for the next 3 years, respectively. What is the accounting rate of return based on average investment? A. 11.78 percent B. 14.69 percent C. 8.72 percent D. 11.04 percent 4. You are considering two mutually exclusive projects with...
A project has the following expected NCFs: Year 1: $80,000, Year 2: $70,000, Year 3: $60,000,...
A project has the following expected NCFs: Year 1: $80,000, Year 2: $70,000, Year 3: $60,000, Year 4: $50,000. If the NINV is $150,000 and the WACC is 6%, what is the NPV of the project? a. $82,659 b. $105,631 c. $93,547 d. $77,753
2. company has been presented with the following investment opportunity. The initial investment is expected to...
2. company has been presented with the following investment opportunity. The initial investment is expected to be $380,000. The operating cash flows are expected to be $120,000 in year 1, $120,000 in year 2, $120,000 in year 3, $80,000 in year 4, $80,000 in year 5 and $50,000 in year 6. If your cost of capital is 14%, what is the NPV and IRR for the project? Should they accept?
Given the following information and assuming straight-line depreciation to zero, what is the NPV for this...
Given the following information and assuming straight-line depreciation to zero, what is the NPV for this project? Initial investment in fixed assets = $800,000 initial investment in net working capital = $200,000 life = 4 years cost savings = $400,000 per year salvage value = $10,000 tax rate = 35% discount rate = 12%
Net Present Value Calculation Initial Investment Discount Rate Net Benefit Year 1 Net Benefit Year 2...
Net Present Value Calculation Initial Investment Discount Rate Net Benefit Year 1 Net Benefit Year 2 New Benefit Year 3 Present Value Is this a worthwhile investment? 100,000 .06 50,000 50,000 50,000 100,000 .12 50,000 50,000 50,000 100.000 .24 50,000 50,000 50,000 200,000 .06 80,000 80,000 80,000 200,000 .36 100,000 100,000 100,000 500,000 .36 200,000 350,000 500,000 500,000 .36 500,00 350,000 200,000
Net Present Value Problem Discount rate 12% Project 1 Year 1 Year 2 Year 3 Year...
Net Present Value Problem Discount rate 12% Project 1 Year 1 Year 2 Year 3 Year 4 Year 5 TOTAL Costs 220,000 35,000 35,000 25,000 20,000 ? Discount factor ? ? ? ? ? Discounted costs ? ? ? ? ? ? Benefits 0 80,000 80,000 65,000 60,000 ? Discount factor ? ? ? ? ? ? Discount benefits ? ? ? ? ? ? Discounted benefits – Discounted costs (NPV) ? ? ? ? ? ? ROI = ???...
Assuming a project having the following cash flows: Year 0 1 2 3 4 Cash flow...
Assuming a project having the following cash flows: Year 0 1 2 3 4 Cash flow -6000 500 -500 5000 3000 What is the NPV of this project if the discount rate is 5%? Report the answer with 2 numbers after decimal place What is the IRR of this project? Report the answer in percentage term with 2 numbers after decimal place such as 12.43%. What discount rate will make NPV of this project equals to -494.258 Report the answer...
A property produces a net operating income of $20,000 in year one ; $30,000 in year...
A property produces a net operating income of $20,000 in year one ; $30,000 in year two, and $45,000 in years 3 to 6. The property will be sold in year five. The resale price is estimated using a terminal capitalization rate of 8.5% applied to the sixth year NOI. What is the value of the property today using a 10.5% discount rate? A. $468,892 B. $502,634 C. $454,872 D. $424,337
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT