Question

Problem 8-9 Calculating NPV [LO 4]

Consider the following cash flows:

Year | Cash Flow | |||

0 | –$ | 33,000 | ||

1 | 14,400 | |||

2 | 17,300 | |||

3 | 11,800 | |||

What is the NPV at a discount rate of zero percent? **(Do not
round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)**

Net present value
$

What is the NPV at a discount rate of 12 percent? **(Do not
round intermediate calculations and round your answer to 2 decimal
places, e.g.,** **32.16.)**

Net present value
$

What is the NPV at a discount rate of 23 percent? **(A
negative answer should be indicated by a minus sign. Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g.,** **32.16.)**

Net present value
$

What is the NPV at a discount rate of 32 percent? **(A
negative answer should be indicated by a minus sign. Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g.,** **32.16.)**

Net present value
$

Answer #1

Consider the following cash flows:
Year
Cash Flow
0
–$
34,000
1
15,100
2
16,600
3
12,500
a.
What is the NPV at a discount rate of zero percent? (Do
not round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)
b.
What is the NPV at a discount rate of 8 percent? (Do
not round intermediate calculations and round your answer to 2
decimal places, e.g., 32.16.)
c.
What is the NPV at a discount...

A project has the following cash flows:
Year
Cash Flow
0
$
72,500
1
–51,500
2
–28,000
What is the IRR for this project? (Do not round
intermediate calculations and enter your answer as a percent
rounded to 2 decimal places, e.g., 32.16.)
Internal rate of return
%
What is the NPV of this project if the required return is 6
percent? (A negative answer should be indicated by a minus
sign. Do not round intermediate calculations and round your...

A project has the following cash flows:
Year Cash Flow
0 –$ 16,600
1 7,300
2 8,600
3 7,100
What is the NPV at a discount rate of zero percent? (Do not
round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)
What is the NPV at a discount rate of 12 percent? (Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.)
What is the NPV at a discount rate...

A project has the following cash flows: Year Cash Flow 0 –$
15,400 1 6,100 2 7,400 3 5,900 What is the NPV at a discount rate
of zero percent? (Do not round intermediate calculations and round
your answer to the nearest whole number, e.g., 32.) NPV $ 4,000
What is the NPV at a discount rate of 8 percent? (Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.) NPV $ 1,276.06 What is...

A project has the following cash flows: Year Cash Flow 0 $
68,500 1 –44,500 2 –31,200 what is the net present value of this
project if the required rate of return is 4 percent? (A negative
answer should be indicated by a minus sign. Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.)

For the given cash flows, suppose the firm uses the NPV
decision rule.
Year
Cash Flow
0
–$
158,000
1
58,000
2
81,000
3
65,000
a.
At a required return of 9 percent, what is the NPV of the
project? (Do not round intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
b.
At a required return of 20 percent, what is the NPV of the
project? (A negative answer should be indicated by...

For the given cash flows, suppose the firm uses the NPV decision
rule. Year Cash Flow 0 –$ 153,000 1 87,000 2 76,000 3 46,000
Requirement 1: At a required return of 9 percent, what is the NPV
of the project? (Do not round intermediate calculations. Round your
answer to 2 decimal places (e.g., 32.16).) NPV $ Requirement 2: At
a required return of 21 percent, what is the NPV of the project?
(Do not round intermediate calculations. Negative amount...

For the given
cash flows, suppose the firm uses the NPV decision rule.
Year
Cash Flow
0
–$
153,000
1
78,000
2
67,000
3
49,000
Requirement 1:
At a required return of 9 percent, what is the NPV of the
project? (Do not round intermediate
calculations. Round your answer to 2 decimal
places (e.g., 32.16).)
NPV
$
Requirement 2:
At a required return of 21 percent, what is the NPV of the
project? (Do not round intermediate
calculations. Negative...

For the given cash flows, suppose the firm uses the NPV
decision rule.
Year
Cash Flow
0
–$
156,000
1
60,000
2
79,000
3
63,000
Requirement 1:
At a required return of 10 percent, what is the NPV of the
project? (Do not round intermediate
calculations. Round your answer to 2 decimal
places (e.g., 32.16).)
NPV
$
Requirement 2:
At a required return of 18 percent, what is the NPV of the
project? (Do not round intermediate...

Suppose you are offered $8,800
today but must make the following payments:
Year
Cash Flows
($)
0
$ 8,800
1
−4,800
2
−3,500
3
−2,600
4
−1,400
a.
What is the IRR of this offer?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places, e.g.,
32.16.)
IRR
%
b.
If the appropriate discount rate
is 13 percent, should you accept this offer?
Reject
Accept
c....

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