Calculate the npv of the project using given discount rate

Reference no: EM132059939

Question: A project requires an investment of £100 today. It has sales of £110 per year for 2 years and then increase by 6% per year thereafter. Costs will be £80 in the first year and increase by 10% for the next year and increase by 8% per year thereafter. Ignoring taxes calculate the NPV of the project at 5% discount rate. (Assume the project is stopped when costs exceed sales in a single year.)

Reference no: EM132059939

Questions Cloud

Define why the strategy will be warranted and justified : What is a promotion strategy for a new breakfast cereal must tie together the product and the market segment to warrant both expenditure of packaging.

Inland from a straight shoreline : A boardwalk is parallel to and 210 ft inland from a straight shoreline. A sandy beach lies between the boardwalk and the shoreline.

What is the irr of the after-tax cash flows for each company : A project requires an initial investment of $100,000 and is expected to produce a cash inflow before tax of $27,000 per year for five years.

Number of donuts sold per day : Consider yourself as an entrepreneur at the Mall selling 5000 donuts a day at 50¢ each. When you raised the price to 70¢ each, the sale dropped

Calculate the npv of the project using given discount rate : A project requires an investment of £100 today. It has sales of £110 per year for 2 years and then increase by 6% per year thereafter.

Find a formula that gives height of the helicopter : Find a formula that gives height of the helicopter at any time t? (Hint: v(t)=h'(t) where h(t) is the height of the helicopter at any time t.)

San francisco earthquake : The 1906 San Francisco earthquake had a magnitude of 8.3 on the Richter scale. At the same time in South America

Find the value of npv using given data : Project A would require an initial outlay of $61,000 and is expected to generate positive cash flows in years one through six of $11,217; $15,385; $11,848.

Find the average rate of change : Find the average rate of change of f(x)= 3x^2 + 4 between x= -2 and x= 1. Illustrate your answer graphically. Please show work or explain!

User Account

All Pages