Oceanic organization, Oceanic Organization is assessing two

Oceanic organization

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Reference no: EM13920397

Discounted Cash Flows - Evaluating Network Migration

Oceanic Organization is assessing two equally Elite Remodeled Designs with a three--year target completion scenarios. Each migration requires an investment of $10,000. The Network Migration had the following cash inflows received at the end of each year.

YEAR REMODELED REMODELED

DESIGNS 1 DESIGNS 2

1 $2,000 $6,000

2 4,000 4,000

3 6,000 2,000

TOTAL $12,000 $12,000

a. What is the net present value of each REMODELED DESIGNS using an 8% discount rate.

b. What is the effect the timing of the cash flows have on a given REMODELED DESIGNS net present value?

c. What is the payback of this investment if the annual inflow was an even $4,000 per

year.

Reference no: EM13920397

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