Question

MM company is considering investing in Project 1 or Project 2. Project 1 generates the following cash flows: year “zero” = 369 dollars (outflow); year 1 = 106 dollars (inflow); year 2 = 286 dollars (inflow); year 3 = 302 dollars (inflow); year 4 = 192 dollars (inflow). Project 2 generates the following cash flows: year “zero” = 410 dollars (outflow); year 1 = 130 dollars (inflow); year 2 = 100 dollars (inflow); year 3 = 190 dollars (inflow); year 4 = 120 dollars (inflow). The MARR is 10 %. Using the Present Worth Method, calculate the Net Present Value of the BEST project. (note: round your answer to the nearest cent, and do not include spaces, currency signs, plus or minus signs, or commas)

Answer #1

Epsilon company is considering investing in Project X or Project
Y. Project X generates the following cash flows: year “zero” = 322
dollars (outflow); year 1 = 280 dollars (inflow); year 2 = 280
dollars (inflow); year 3 = 369 dollars (inflow); year 4 = 158
dollars (inflow). Project Y generates the following cash flows:
year “zero” = 230 dollars (outflow); year 1 = 120 dollars (inflow);
year 2 = 100 dollars (inflow); year 3 = 200 dollars (inflow); year...

You are planning to acquire a business today and sell it in 3
years. The cash flows associated with this investment are: 256427
an expense of dollars in year zero; an expense of 40128 dollars in
year 1; a receivable of 22758 dollars in year 2; a receivable of
38650 dollars in year 3. In addition, you expect to sell the
business for 360323 dollars upon the last receivable. If the MARR
(Minimum Acceptable Rate of Return) is 5% per...

ZZz company is considering an investment (at time = 0) in a
machine that produces headphones. The cost of the machine is 86680
dollars with zero expected salvage value. Annual production in
units during the 3-year life of the machine is expected to be
(starting at time = 1) 8145, 11532, and 9929. The headphones sale
price per unit is 12 dollars in year one and it is expected to
increase by 8% per year thereafter. Production costs per unit...

What is the net present value of a project that has an initial
cash outflow of $-11,400, at time 0, and the following cash flows
for years 1-4? The required return is 10.0%. DO NOT USE DOLLAR
SIGNS OR COMMAS IN YOUR ANSWER. ENTER YOUR ANSWER TO THE NEAREST
DOLLAR (e.g. 1250). Year Cash Flows 1 $4,500 2 $4,350 3 $5,400 4
$7,250 Question 1 options: Answer Question 2 (1 point) A project
has cash flows of -$163,500, $60,800, $62,300...

Suppose your firm is considering investing in a project with the
cash flows shown below, that the required rate of return on
projects of this risk class is 11 percent, and that the maximum
allowable payback and discounted payback statistic for the project
are 2 and 3 years, respectively.
Time 0 1 2 3 4 5 6
Cash Flow -990 190 410 610 610 210 610
Use the NPV decision rule to evaluate this project; should it be
accepted or...

Rio Tinto is planning a strip-mining project that costs $90,000
initially and generates the following cash flows:
Year 1: $131,000
Year 2: $98,980
Year 3: -$147,650
Cash flow in Year 3 will be spent to restore the terrain, hence
it is negative. The required return is 13.5%. Which of the
following statements would you most agree with?
A. At a discount rate of 41.092%, the present value of future
cash flows is close to $90,000. Hence, the breakeven rate is...

QUESTION 3 (10
Pelosi Company is
considering a project with the following information.
The initial
investment of the project costs the company $15,000 now
(outflow at t0). The real interest rate
(r) is 15% and the expect inflation rate
(h) is 10%. All cash flows in Year 1 and
Year 2 occur at the end of the year.
Year
Nominal Cash Flow
Real Cash Flow
1
$11,000
real CF1 = ?
2
$24,200
real CF2 = ?
Using Fisher equation,...

Your company is looking at a new project in Mexico. The project
will cost 900,000 pesos. The cash flows are expected to be 375,000
pesos per year for 5 years. The current spot exchange rate is 19.07
pesos per dollar. The risk-free rate in the US is 4%, and the
risk-free rate in Mexico 8%. The dollar required return is 10%.
What is the net present value of this investment in U.S. Dollars?
DO NOT USE DOLLAR SIGNS OR COMMAS...

Please show in excel
A new production line generates the following incremental cash
flows over its 5-year useful life.
Year
1
2
3
4
5
Cash flow ($ million)
1.5
1.3
1.05
0.9
0.7
What is the present worth of these cash inflows given that the
cost of capital for the project is 12%?
Given that the forecasted inflation rate is 3% per year over the
period estimate the real cash flows (expressed in terms of year 0
dollars) and...

Apex, Inc. is a U.S.-based firm investing in a two-year project
in Mexico. The present exchange rate is 16 Mexican pesos per U.S.
dollar. It is estimated that Mexico’s currency will be devalued in
the international market at an average 2.7 % per year relative to
the U.S. dollar over the next several years. The estimated
before-tax net cash flow (in pesos) of the project is a follows:
End of Year Net Cash Flow (pesos) 0 - 900,000 1 480,000...

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