What is each alternatives irr

Assignment Help Corporate Finance
Reference no: EM13196262

Capitol Healthplans, Inc., is evaluating two different methods for providing home health services to its memebers. Both methods involve contracting out for services, and the health outcomes and revenues are not affected by the method chosen. Therefore the incremental cash flows for the decision are all outflows. Here are the prjected flows:

Year---- Method A-------Method B

0 -----($300,000)----($120,000)

1--------66,000--------96,000

2---------66,000-------96,000

3---------66,000-------96,000

4--------66,000-------96,000

5---------66,000-------96,000

a. What is each alternative's IRR?

b. If the cost of capital for both methods is 9 percent, which method should be chosen?

Reference no: EM13196262

Questions Cloud

What is the other number : The average of two numbers, a and b, is given. The average is 75 one number is 91, what is the other number? Please show all work.
What are the cash flows assoicated with the project : What are the cash flows assoicated with the project, what is the project's IRR and assuming a project cost of capital of 10 percent, what is the projectect's NPV?
At what rate in cubic centimeters per minute is the volume : Suppose that at a certain instant the volume is 540 cubic centimeters and the pressure is 83 kPa and is decreasing at a rate of 11 kPa/minute. At what rate in cubic centimeters per minute is the volume increasing at this instant?
Find the work required to pump all the water out over : A rectangular swimming pool 60 ft long, 10 ft wide, and 8 ft deep is filled with water to a depth of 7 ft. Use an integral to find the work required to pump all the water out over the top. (Take as the density of water delta = 62.4 hbox{lb/ft}^3.)
What is each alternatives irr : What is each alternatives IRR and if the cost of capital for both methods is 9 percent, which method should be chosen?
The types of protection conveys a negative externality : The "club" makes it difficult for a car thief to take your car. Lojack makes it easier for the police to catch the car thief who has stolen it.which one conveys a positive externality.
Define what is the ph of the buffer : A buffer contains 0.16mol of propionic acid (C2H5COOH) and 0.17mol of sodium propionate(C2H5COONa) in 1.20 L. 1)What is the pH of this buffer?
How many times is the velocity of the object equal to 0 : The position of an object attached to a spring is given by the formula: y(t)=(1/6)cos(5t)-(1/4)sin(5t), where t is time in seconds. In the first 4 seconds, how many times is the velocity of the object equal to 0?
What dimensions will allow the board to have a maximum rate : A computer parts company wants to make a rectangle memory board that has a perimeter of 28 cm. What dimensions will allow the board to have a maximum rate.

Reviews

Write a Review

Corporate Finance Questions & Answers

  Impact of the global economic crisis on business environment

This paper reviews the article of ‘the impact of the global economic crisis on the business environment' that is written by Roman & Sargu (2011).

  Explain the short and the long-run effects on real output

Explain the short and the long-run effects on real output, price, and unemployment

  Examine the requirements for measuring assets

Examine the needs for measuring assets at fair value in accounting standards

  Financial analysis report driven by rigorous ratio analysis

Financial analysis report driven by rigorous ratio analysis

  Calculate the value of the merged company

Calculate the value of the merged company, the gains (losses) to each group of shareholders, NPV of the deal under different payment methods. Synergy remains the same regardless of payment method.

  Stock market project

Select five companies for the purpose of tracking the stock market, preparing research on the companies, and preparing company reports.

  Write paper on financial analysis and business analysis

Write paper on financial analysis and business analysis

  Intermediate finance

Presence of the taxes increase or decrease the value of the firm

  Average price-earnings ratio

What is the value per share of the company's stock

  Determine the financial consequences

Show by calculation the net present value for the three alternatives (no education, network design certification, mba). Also, according to NPV suggest which alternative you advise your friend to choose

  Prepare a spread sheet model

Prepare a spread sheet model for the client that determines NPV/IRR with and without tax.

  Principles and tools for financial decision-making

Principles and tools for financial decision-making. Analyse the concept of corporate capital structure and compute cost of capital.

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!

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