Question

A project has an initial cost of $62,725, expected net cash inflows of $14,000 per year...

A project has an initial cost of $62,725, expected net cash inflows of $14,000 per year for 7 years, and a cost of capital of 10%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Present Value of Outflow = $ 62,725

Present Value of Inflows = 14,000 * 1/ (1.10) ^ 1 +14,000 * 1/ (1.10) ^ 2 +14,000 * 1/ (1.10) ^ 3+....+14,000 * 1/ (1.10) ^ 7

= $ 68,157.86

Future  Value of Inflows = Present  Value of Inflows * ( 1+ Rate of Interest ) ^ Time

= $ 68,157.86 * ( 1+10/100) ^ 7

= $ 132,820.3873

MIRR=[Future value of inflows/Present value of outflow]^(1/n)-1

= [ $ 132,820.3873 / 62,725 ] ^ ( 1/7) -1

= 11.31310469

Hence the correct answer is 11.31 %

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
MIRR A project has an initial cost of $48,025, expected net cash inflows of $8,000 per...
MIRR A project has an initial cost of $48,025, expected net cash inflows of $8,000 per year for 12 years, and a cost of capital of 13%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places. Profitability Index A project has an initial cost of $45,950, expected net cash inflows of $13,000 per year for 10 years, and a cost of capital of 12%. What is the project's PI? Do not round...
A project has an initial cost of $36,075, expected net cash inflows of $14,000 per year...
A project has an initial cost of $36,075, expected net cash inflows of $14,000 per year for 7 years, and a cost of capital of 10%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places. Answer = _____________________ A project has an initial cost of $48,675, expected net cash inflows of $14,000 per year for 10 years, and a cost of capital of 13%. What is the project's PI? Do not round...
1. A project has an initial cost of $74,475, expected net cash inflows of $9,000 per...
1. A project has an initial cost of $74,475, expected net cash inflows of $9,000 per year for 8 years, and a cost of capital of 12%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places. 2. A project has an initial cost of $46,800, expected net cash inflows of $10,000 per year for 6 years, and a cost of capital of 13%. What is the project's PI? Do not round your...
A project has an initial cost of $55,000, expected net cash inflows of $12,000 per year...
A project has an initial cost of $55,000, expected net cash inflows of $12,000 per year for 8 years, and a cost of capital of 13%. What is the project's MIRR? (Hint: Begin by constructing a time line.) Do not round intermediate calculations. Round your answer to two decimal places. A project has an initial cost of $55,000, expected net cash inflows of $10,000 per year for 11 years, and a cost of capital of 12%. What is the project's...
A project has an initial cost of $45,000, expected net cash inflows of $14,000 per year...
A project has an initial cost of $45,000, expected net cash inflows of $14,000 per year for 7 years, and a cost of capital of 13%. What is the project's PI? (Hint: Begin by constructing a time line.) Do not round intermediate calculations. Round your answer to two decimal places. My answer = 1.38. Would like to double check to see if that is correct.
MIRR A project has an initial cost of $39,450, expected net cash inflows of $11,000 per...
MIRR A project has an initial cost of $39,450, expected net cash inflows of $11,000 per year for 10 years, and a cost of capital of 12%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
A project has an initial cost of $64,400, expected net cash inflows of $10,000 per year...
A project has an initial cost of $64,400, expected net cash inflows of $10,000 per year for 11 years, and a cost of capital of 12%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
A project has an initial cost of $73,000, expected net cash inflows of $11,000 per year...
A project has an initial cost of $73,000, expected net cash inflows of $11,000 per year for 6 years, and a cost of capital of 11%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
A project has an initial cost of $65,900, expected net cash inflows of $12,000 per year...
A project has an initial cost of $65,900, expected net cash inflows of $12,000 per year for 12 years, and a cost of capital of 8%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
MIRR A project has an initial cost of $40,500, expected net cash inflows of $15,000 per...
MIRR A project has an initial cost of $40,500, expected net cash inflows of $15,000 per year for 12 years, and a cost of capital of 14%. What is the project's MIRR? Do not round intermediate calculations. Round your answer to two decimal places.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT