User Account

All Pages

Estimating the machine will generate cash inflows

Assignment Help Finance Basics
Reference no: EM131318419

Corporation Y needs to purchase a new machine costing $2.08 million. Management is estimating the machine will generate cash inflows of $396,000 for two years and $300,000 for the following seven years. If management requires a minimum 8 percent rate of return, should the firm purchase this particular machine? Why or why not?

A. no; because the IRR is 7.57 percent
B. yes; because the IRR is 8.47 percent
C. no; because the IRR is .68 percent
D. yes; because the IRR is 10.38 percent

Reference no: EM131318419

Questions Cloud

Numbers to bond investors : Suppose that a bond has a yield to call (YTC) equal to 6.5 percent and a yield to maturity (YTM) equal to 6.3 percent. Explain the meanings of these numbers to bond investors.
Do preemptive actions work better than a defensive posture : The concept of "If we fight terrorists somewhere else, they will not come here" has been bantered about for years. Do preemptive actions work better than a defensive posture (attacking terrorists on home soil)? Explain your answer.
Write in the value with two decimal points : If investors require a return of 11.8% from this stock, what is the value of the ABC stock? Write in the value with two decimal points but no dollar sign or comma.
Define estimate of this company''s price per share of stock : Why might you prefer to use a measure of cash flow generating ability such as earnings instead of sales in relative valuation?
Estimating the machine will generate cash inflows : Corporation Y needs to purchase a new machine costing $2.08 million. Management is estimating the machine will generate cash inflows of $396,000 for two years and $300,000 for the following seven years. If management requires a minimum 8 percent r..
Should all new buildings be required by law to adopt leed : Investigate LEED (Leadership in energy and Environmental Design) building designs. Should all new buildings be required by law to adopt LEED design standards and conform to the LEED rating system?
Why this building is vital to the community : Emergency managers should know how to assess vital buildings in communities in order to protect the occupants in light of an emergency.Access the Anytown, USA Simulation. Assess the government building in the Downtown Region.Construct a concise mit..
Prepare a horizontal common size analysis for the net sales : Using 2008 as the base, prepare a horizontal common-size analysis for the Net sales and Assets.- Comment on each of the horizontal common-size in (a).
Sensitivity of the project npv : You would like to test the sensitivity of the project's NPV to the sales quantity. Which one of the following sales prices should you use in your analysis?

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd