Question

- 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

- -16,800
- 7,900
- 9,100
- 8,700
- 7,500
- -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

Answer #1

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:
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
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
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
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 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 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 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: 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 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

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