Question

M Company is evaluating a project with the following cash flows. The company uses a discount...

  1. M Company is evaluating a project with the following cash flows. The company uses a discount rate of 8% and a reinvestment rate of 5% on all of its projects.

            Year                                        Cash Flow

  1. -16,800
  2. 7,900
  3. 9,100
  4. 8,700
  5. 7,500
  6. -4,900

Calculate the MIRR of the project using all three methods with the above interest rates.

1.Discounting Approach

2. Reinvestment approach

3. Combination Approach

Homework Answers

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
Solo Corp. is evaluating a project with the following cash flows: Year Cash Flow 0 –$12,400...
Solo Corp. is evaluating a project with the following cash flows: Year Cash Flow 0 –$12,400 year cash flow 0 - $12,400 1 $5,900 2 $6,200 3 $5,900 4 $4,800 5 -$4,400 The company uses a disount rate of 11 percent and a reinvestment rate of 8 percent on all of its projects. Calculate the MIRR of the project using all three methods using these interest rates . a. MIRR using the discounting approach. b. MIRR using the reinvestment approach....
Problem 9-20 MIRR [LO6] RAK Corp. is evaluating a project with the following cash flows:   ...
Problem 9-20 MIRR [LO6] RAK Corp. is evaluating a project with the following cash flows:    Year Cash Flow 0 –$ 30,000 1 12,200 2 14,900 3 16,800 4 13,900 5 – 10,400    The company uses a discount rate of 12 percent and a reinvestment rate of 7 percent on all of its projects.    Calculate the MIRR of the project using the discounting approach. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2...
A company is evaluating a project with the following cash flows: Year CASH FLOW 0 -49,000...
A company is evaluating a project with the following cash flows: Year CASH FLOW 0 -49,000 1 13,700 2 25,200 3 30,500 4 19,800 5 -8,500 The company uses an interest rate of 10% on all projects, Calculate the MIRR of the project using all three methods
Solo Corp. is evaluating a project with the following cash flows: Year CF 0 -$48,000 1...
Solo Corp. is evaluating a project with the following cash flows: Year CF 0 -$48,000 1 17,000 2 21,900 3 25,400 4 18,000 5 -6,500 Use the discounting approach to determine the MIRR. Assume the discount rate is 8%. Select one: A. 15.64% B. 19.86% C. 20.32% D. 20.98% E. 21.51%
A company is evaluating an investment project with the following forecast cash flows: Year                         0   
A company is evaluating an investment project with the following forecast cash flows: Year                         0               1                  2                    3                     4 Cash flow($m)        (6.5)            2.4               3.1                 2.1                   1.8 Using discount rates of 15% and 20%, what is the internal rate of return of the investment project?
Butler International Limited is evaluating a project in Erewhon. The project will create the following cash...
Butler International Limited is evaluating a project in Erewhon. The project will create the following cash flows: Year Cash Flow 0 –$ 1,230,000 1 405,000 2 470,000 3 365,000 4 320,000    All cash flows will occur in Erewhon and are expressed in dollars. In an attempt to improve its economy, the Erewhonian government has declared that all cash flows created by a foreign company are “blocked” and must be reinvested with the government for one year. The reinvestment rate...
Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this...
Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project? Year Project 0 ($11,368,000) 1 $ 2,187,590 2 $ 3,787,552 3 $  3,275,650 4 $ 4,115,899 5 $ 4,556,424
(Question 8) Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate...
(Question 8) Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project Year 0 1 2 3 4 5 project $11,368,00 $2,157,590 $3,787,552, $3,275,650 $4,115,899 $4,556,424 Round to two decimal places. (Question 8) Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in...
Yellow Day has a project with the following cash flows: Year Cash Flows 0: −$25,400 1:...
Yellow Day has a project with the following cash flows: Year Cash Flows 0: −$25,400 1: 9,750 2: 13,900 3: 8,760 4: −2,800 What is the MIRR for this project using the reinvestment approach? The interest rate is 7 percent
Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this...
Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project? Year Project 0 ($11,368,000) 1 $ 2,112,589 2 $ 3,787,552 3 $ 3,175,650 4 $ 4,115,899 5 $ 4,556,424 Round to two decimal places