What is net present value

Assignment Help Financial Management
Reference no: EM132051266

The Blueberry Company is considering a project which will cost $421 initially. The project will not produce any cash flows for the first 3 years. Starting in year 4, the project will produce cash inflows of $572 a year for 4 years. This project is risky, so the firm has assigned it a discount rate of 18.2 percent. What is the net present value?

Reference no: EM132051266

Questions Cloud

Intellectual property of several tech firms : The patents and intellectual property of several tech firms (like Facebook and Google) are owned by subsidiaries in __________.
Intermolecular forces that would affect the water molecule : Explain all forces and changes that the electron undergoes as it forms an intramolecular bond with oxygen to form a water molecule.
What was the closing balance on the payables control account : Contra with receivables ledger - credit receivables ledger 15,000. What was the closing balance on the payables control account
Discuss why the land is worth more in the problem : Briefly discuss why the land is worth more in this problem than in the previous problem. Also explain briefly why is it better not to build the project today.
What is net present value : This project is risky, so the firm has assigned it a discount rate of 18.2 percent. What is the net present value?
Closest approximation of the lattice energy of naf : Which of the following values is the closest approximation of the lattice energy of NaF: 682 kJ/mol, 794 kJ/mol, 924 kJ/mol, 1588 kJ/mol, or 3175 kJ/mol?
What is after-tax salvage value of equipment : What is the after-tax salvage value of the equipment? What is the initial investment in Net Working Capital?
What is the speculative premium on the warrant : Preston Toy Co. has warrants outstanding that allow the holder to purchase a share of stock for $12 (exercise price). The common stock is currently selling.
Calculate brad gross profit for the period : At the start of the period, his inventory was £38,300 and at the end of the period his inventory was £40,400. Calculate Brad's gross profit for the period

Reviews

Write a Review

Financial Management Questions & Answers

  What is the estimated value per share of your firms stock

What is the required rate of return on your company’s stock? What is the estimated value per share of your firm’s stock?

  Weakening dollar or constant value dollar

For a company that is planning to issue bonds in the US to raise a few billion dollars, what would be a desirable trend in the value of the US dollar (i.e. a strengthening dollar, a weakening dollar, or a constant value dollar) and why?

  Withdraw the balance in his investment plan and deposit

he expects to withdraw the balance in his investment plan and deposit it in a savings account. This savings account pays 6% per year, compounded monthly.

  Equity requirement-what is the value of a property

If the equity requirement is 10 percent and a mortgage can be obtained for 25 years at 5 percent. If the loan to value ratio is 70 percent (equity is 30 percent), what is the value of a property that generates $125,000 in net operating income. Hint, ..

  What is the risk-free interest rate

You buy a share of stock, write a 1-year call option with strike price X = $100 and buya 1-year put option with strike price X = $100. The net outlay required to establish this portfolio is $97. The stock pays no dividends. What is the risk-free i..

  Significant mean difference between two treatment condition

Briefly explain what is meant when a researcher reports "a significant mean difference between two treatment conditions."

  Accounts receivable increase as result of this change

ABC thinks that its sales will be $1,901,000 next year following this change. How much will ABC's accounts receivable increase as a result of this change?

  Finance plant expansion

DiPitro’s Paint and Wallpaper, Inc., needs to raise $1.20 million to finance plant expansion.

  Is a taxed on the transfer of the land

Canine owns 90% of Dog and agrees to transfer $1 in exchange for 1 additional share of Dog. Is A taxed on the transfer of the land?

  Shares of outstanding and an equity cost of capital

Tolo Co. plans the following repurchases: $9.8 million in one year, nothing in two years, and $20.7 million in three years. After that, it will stop repurchasing and will issue dividends totaling $24.1 million in four years. The total paid in dividen..

  The average accounts receivable balance

ABC Company has annual sales of $180,043 and cost of goods sold of $44,437. The average accounts receivable balance is $13,627. How many days on average does it take the firm to collect its accounts receivable? That is, what is the AR Period? Assume ..

  European call and put option

A European call and put option have the same maturity and both are at the money.

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