Question

- What will be the net present value of a project that provides net cash flow of $20,000 at the end of the first year, $7,000 at the end of the second year, and $13,000 at the end of the third year? The initial cost is $8,000 and the appropriate discount rate is 10%.
- Tophill Corporation is considering a project that will pay $10,000 at the end of the first year, $22,000 at the end of the second year, and $40,000 at the end of the third year. The project's appropriate discount rate is 10% and the project requires an investment tomorrow of $52,000 if we accept the project. What are the NPV and Profitability Index of this project?

Answer #1

What is the net present value of a project that requires a
$2,000 investment today and returns $800 at the end of the first
year and $1,700 at the end of the second year? Assume a discount
rate of 10%

Net present value. Quark Industries has a project with the
following projected cash flows: Initial cost: $200,000 Cash flow
year one: $23,000 Cash flow year two: $72,000 Cash flow year
three: $157,000 Cash flow year four: $157,000 a. Using a
discount rate of 10% for this project and the NPV model,
determine whether the company should accept or reject this project.
b. Should the company accept or reject it using a discount rate of
14%? c. Should the company accept...

(Net present value calculation) Big Steve's, makers of
swizzle sticks, is considering the purchase of a new plastic
stamping machine. This investment requires an initial outlay of
$95,000 and will generate net cash inflows of $19,000 per year
for 11 years.
a. What is the project's NPV using a discount rate of 9
percent? Should the project be accepted? Why or why not?
b. What is the project's NPV using a discount rate of 13
percent? Should the project be...

17- Project L has a cost of ?$81,000. Its expected net cash
inflows are ?$90,000 per year for 8 years. What is the? project's
payback? period? If the cost of capital is 9?%, what are the?
project's net present value? (NPV) ? and what is the profitability
index? (PI)? What is the? project's internal rate of return?
(IRR)?

1. Net present value (NPV)
Evaluating cash flows with the NPV method
The net present value (NPV) rule is considered one of the most
common and preferred criteria that generally lead to good
investment decisions.
Consider this case:
Suppose Happy Dog Soap Company is evaluating a proposed capital
budgeting project (project Alpha) that will require an initial
investment of $450,000. The project is expected to generate the
following net cash flows:
Year
Cash Flow
Year 1
$375,000
Year 2
$425,000...

No need to show work, Will thumbs up fast.
1.) What is the net present value of a project that has an
initial cost of $40,000 and produces cash inflows of $8,000 a year
for 11 years if the discount rate is 15 percent?
Group of answer choices
$798.48
$1869.69
$1240.23
$2470.01
2.) The Chicken Basket is considering a project with an initial
cost of $20,000. The project will produce cashflows of: $6,700 in
year 1, $6,300 in year 2,...

Net present value (NPV)
Evaluating cash flows with the NPV method
The net present value (NPV) rule is considered one of the most
common and preferred criteria that generally lead to good
investment decisions.
Consider this case:
Suppose Hungry Whale Electronics is evaluating a proposed
capital budgeting project (project Alpha) that will require an
initial investment of $400,000. The project is expected to generate
the following net cash flows:
Year
Cash Flow
Year 1
$325,000
Year 2
$400,000
Year 3...

What is the net present value (NPV) of a project whose cost is $
45,000 and that is expected to generate a cash flow after taxes of
$ 14,000 in the first 2 years, $ 10,000 in the next 2 years, and $
8,000 in the 5th year with a required rate of return of 8%?

When the present value of the cash inflows exceeds the initial
cost of a project, then the project should be
Group of answer choices
accepted because the internal rate of return is positive
accepted because the profitability index is less than 1.
accepted because the profitability index is negative.
accepted because IRR is higher than the discount rate.
rejected because the net present value is negative

2. Net present value (NPV)
Evaluating cash flows with the NPV method
The net present value (NPV) rule is considered one of the most
common and preferred criteria that generally lead to good
investment decisions.
Consider the case of Lumbering Ox Truckmakers:
Suppose Lumbering Ox Truckmakers is evaluating a proposed
capital budgeting project (project Alpha) that will require an
initial investment of $400,000. The project is expected to generate
the following net cash flows:
Year
Cash Flow
Year 1
$375,000...

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