Solution-Explain net present value at the required rate of

Explain net present value at the required rate of return

Assignment Help Finance Basics

Reference no: EM133001161

Initial fixed asset cost of $2.168 million which will be depreciated straight-line to a zero book value over the 10-year life of the project. At the end of the project the equipment will be sold for an estimated $495,000. The project will not directly produce any sales but will reduce operating costs by $634,000 a year. The tax rate is 30 percent. The project will require $128,000 of net working capital which will be recouped when the project ends. What is the net present value at the required rate of return of 15 percent?

Reference no: EM133001161

Questions Cloud

Computing firm earnings per share after the stock dividend : NewTech Corporation is offering a 10% stock dividend. The firm currently has 200,000 shares outstanding and after-tax profits of $800,000.

Critically evaluate and reflect on effective relationships : Critically assess the key principles and theories underlying management to achieve high-performing organisations at projects, teams, and individual levels

What is the cost of goods sold for ivanhoe inc : What is the cost of goods sold for 2022? (Round cost per unit to 2 decimal places, e.g. 15.25 and final answer to 0 decimal places, e.g. 125.)

Interpret an upward sloping yield curve : -Discuss how you might interpret an upward sloping yield curve. Flat yield curve. Downward sloping yield curve. (EACH THEORY)

Explain net present value at the required rate of return : Initial fixed asset cost of $2.168 million which will be depreciated straight-line to a zero book value over the 10-year life of the project.

How much of the overhead cost in july was maintenance : Estimate how much of the $202,000 of overhead cost in July was maintenance cost. To do this, first determine how much of the $202,000 consisted

What is the net present value of expansion project : Expects operating cash flows of $50,000 a year for nine years as a result. This expansion requires $36,500 in new fixed assets. These assets will be worthless a

What is the value of the macquarie group call : Macquarie Group's stock price is $160 and could halve or double in each six month period (equivalent to a standard deviation of 98%). A one-year call option on

What is the future value of a 5-year ordinary annuity : Future value of an annuity. What is the future value of a 5-year ordinary annuity with annual payments of $200, evaluated at a 15 percent interest rate?

User Account

All Pages

Explain net present value at the required rate of return

Reference no: EM133001161

Reference no: EM133001161

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Financial reporting and analysis

A report on financial accounting

Describe the types of financial ratios

Differences between sole proprietorship and corporation

Prepare a cash budget statement

What are the implied interest rates

State pricing theory and no-arbitrage pricing theory

Small business administration

Effect of financial leverage

Evaluate the basis for the payment to the lender

Importance of opps, ipps, mpfs and dmepos

Time value of money

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT