Computing npv if discount rate is given

Reference no: EM1310692

Q1) Briarcrest Condiments is spice-making firm. Newly, it developed new process for producing spices. Process needs new machinery which would cost $2,109,194 have a life of five years, and would make the cash flows given in the following table.

Year   Cash Flow
1     $513,316
2      -225,749
3      1,000,114
4       849,873
5        758,037

Compute the NPV if discount rate is 13.74%?

Q2) Compute duration of 2-year Euro-note with $100,000 par value and annual coupon rate of 10%if today’s yield to maturity is 11.5%. Determine the duration be if today’s yield was 5.5%?

Reference no: EM1310692

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