What is interest rate at which two alternatives are equal

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1. Your firm has decided to purchase a new $50,000 machine. You can pay now and take a 3 percent discount or pay $11,500 each year for the next five years. What is the interest rate at which the two alternatives are equal?

2. NPV Project K costs $35,000, its expected cash inflows are $9,000 per year for 11 years, and its WACC is 13%. What is the project's NPV? Round your answer to the nearest cent.

3. Explain why bonds values change with maturity.

Reference no: EM132049037

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