Question

Consider the following two mutually exclusive projects: |

Year | Cash Flow (A) | Cash Flow (B) |

0 | –$285,537 | –$14,875 |

1 | 28,200 | 4,193 |

2 | 59,000 | 8,632 |

3 | 52,000 | 13,431 |

4 | 396,000 | 8,922 |

Whichever project you choose, if any, you require a 6 percent return on your investment. |

(e) |
What is the NPV for Project A? |

(Click to select)$146,378.68$155,433.03$150,905.86$143,360.56$158,451.15 |

(f) |
What is the NPV for Project B ? |

(Click to select)$15,862.45$14,653.88$14,351.74$15,560.31$15,107.1 |

(g) |
What is the IRR for Project A? |

(Click to select)19%19.4%21%20%20.6% |

(h) |
What is the IRR for Project B? |

(Click to select)37.83%39%40.17%40.95%37.05% |

(i) |
What is the profitability index for Project A? |

(Click to select)1.6051.5741.4521.4831.528 |

(j) |
What is the profitability index for Project B? |

(Click to select)2.1162.0161.9551.9152.076 |

Answer #1

Consider the following two mutually exclusive projects:
Year Cash Flow (A) Cash Flow (B)
0 –$244,500 –$14,607
1 29,800 4,237
2 59,000 8,285
3 55,000 13,203
4 410,000 8,788
Whichever project you choose, if any, you require a 6 percent
return on your investment.
a. What is the payback period for Project A?
What is the payback period for Project B?
What is the discounted payback period for Project A?
What is the discounted payback period for Project...

Consider the following two mutually exclusive projects:
Year
Cash Flow (A)
Cash Flow (B)
0
–$218,917
–$16,419
1
25,700
5,985
2
53,000
8,370
3
58,000
13,931
4
420,000
8,655
Whichever project you choose, if any, you require a 6 percent
return on your investment.
What is the NPV for Project A?
What is the NPV for Project B?

Consider the following two mutually exclusive projects:
Year Cash Flow
(A) Cash Flow
(B)
0 –$ 341,000 –$ 51,000
1 54,000 24,900
2 74,000 22,900
3 74,000 20,400
4 449,000 15,500
Whichever project you choose, if any, you require a return of
15 percent on your investment.
a-1 What is the payback period for each project? (Do not round
intermediate calculations and round your answers to 2 decimal
places, e.g., 32.16.)
a-2...

Consider the following two mutually exclusive projects:
Year
Cash Flow (A)
Cash Flow (B)
0
–$218,917
–$16,419
1
25,700
5,985
2
53,000
8,370
3
58,000
13,931
4
420,000
8,655
Whichever project you choose, if any, you require a 6 percent
return on your investment.
What is the discounted payback period for Project A?
What is the discounted payback period for Project B?

Part 2. Consider the following two
mutually exclusive projects:
Year
Cash Flow (A)
Cash Flow (B)
0
- $ 300,000
- $40,000
1
20,000
19,000
2
50,000
12,000
3
50,000
18,000
4
390,000
10,500
Whichever project you choose, if any, you require a 15 percent
return on your investment.
a. If you apply the payback criterion, which
investment will you choose? Why?
b. If you apply the discounted payback
criterion, which investment will you choose? Why?
c. If...

Consider the following two mutually exclusive projects:
Year
Cash Flow (A)
Cash Flow (B)
0
–$40,000
–$180,000
1
25,000
15,000
2
22,000
45,000
3
20,000
50,000
4
15,000
275,000
The required return on these investments is 11 percent.
Required:
(a)
What is the payback period for each project?
(Do not round intermediate
calculations. Round your answers to 2 decimal
places (e.g., 32.16).)
Payback period
Project A
years
Project B
years ...

You are considering the following two
mutually exclusive projects with the following cash flows:
Project
A
Project B
Year Cash
Flow
Year Cash Flow
0
-$75,000
0 -$70,000
1
$19,000
1 $10,000
2
$48,000
2 $16,000
3
$12,000
3 $72,000
Required rate of
return
10
%
13 %
Calculate the NPV, IRR,...

Consider the following two mutually exclusive projects:
Year 0 Cash Flow(X) - $19,200 Cash Flow(Y) -$19,200
Year 1 Cash Flow(X) 8,650 Cash Flow(Y) 9,700
Year 2 Cash Flow(X) 8,700 Cash Flow(Y) 7,600
Year 3 Cash Flow (X) 8,600 Cash Flow (Y) 8,500
A.) Calculate the IRR for each project.
Project X ___%
Project Y ___%
B.) What is the crossover rate for these two projects?
C.) What is the NPV of Projects X and Y at discount rates of 0...

Consider the following two mutually exclusive
projects:
Year
Cash Flow (A)
Cash Flow (B)
0
–$
424,000
–$
39,500
1
44,500
20,300
2
61,500
13,400
3
78,500
18,100
4
539,000
14,900
The required return on these investments is 11 percent.
a. What is the payback period for each project?
(Do not round intermediate calculations and round your
answers to 2 decimal places, e.g., 32.16.)
Payback period
Project A
years
Project B
years
b. What is the NPV for each...

Mahjong, Inc., has identified
the following two mutually exclusive projects:
Year
Cash Flow
(A)
Cash Flow
(B)
0
–$37,300
–$37,300
1
19,660
7,180
2
15,170
13,680
3
12,660
20,160
4
9,660
24,160
Required:
(a)
What is the IRR for Project
A?
(b)
What is the IRR for Project
B?
(c)
If the required return is 11
percent, what is the NPV for Project A?
(d)
If the required...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 14 minutes ago

asked 19 minutes ago

asked 28 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago