User Account

All Pages

What is the irr of the new project

Assignment Help Finance Basics
Reference no: EM132515904

The Sisyphean Company is planning on investing in a new project. This will involve the purchase of some new machinery costing $450,000. The Sisyphean Company expects cash inflows from this project as detailed below:

Year 1 Year 2 Year 3 Year 4

$150,000 $185,000 $190,000 $200,000

The cost of capital is 15%. What is the IRR of the new project? Should the project be accepted?

IRR = 20.75%. Yes, because IRR > r = 15%.

IRR = 14.30%. No, because IRR < r = 15%.

IRR = 21.10%. Yes, because IRR > r = 15%.

IRR = 13.70%. No, because IRR < r = 15%.

Reference no: EM132515904

Questions Cloud

Describe personal leadership philosophy : Describe your personal leadership philosophy based on your leadership skills and emotional intelligence assessment results.
Write about QRP plan for a real-life project : Write about QRP plan for a real-life project. When we refer to the term "real-life "it means that there must be a real project either finished or ongoing
Determining the realised yield : If he sold the bond today, what would be his realised yield? (Round to the nearest percent.)
Expect the yield to maturity on the bond : If you expect the yield to maturity on the bond to be 7% at the beginning of next year, what is your HPR, assuming you have received the coupon for this year?
What is the irr of the new project : The cost of capital is 15%. What is the IRR of the new project? Should the project be accepted?
What would be the value of the bond in year 5 : After 5 years, the yield to maturity of the bond is predicted to increase to 6% per annum, what would be the value of the bond in Year 5?
Determining the traditional plowback ratio : The leadingP/E is 3.33 and the stock is sold at $10.60. What is it's traditional plowback ratio?
Discuss the challenge with covid-19 in your organization : Discuss how the nursing leadership role is instrumental in providing effective healthcare delivery. Discuss the challenge with COVID-19 in your organization.
Process of ethical business : Determine the considerations for and process of ethical business decision making to balance corporate and social responsibilities, and address moral, economic,

Reviews

Write a Review

Finance Basics Questions & Answers

  Analysis for post retirement income scheme

Suppose you have reached retirement. You have saved a good amount of money, say EUR 500,000, but, if you wish to take a currency and an amount more realistic for your country, please do so. You are now to make a comparison between two approaches t..

  The oasdi program pays disability benefits

The OASDI program pays disability benefits to a disabled worker and eligible family members. Explain whether each of the following persons would be eligible for disability-income benefits.

  What will be the increase in pre-tax profits

A project has fixed costs of $1.000 per year, depreciation charges of $500 a year, revenue of $6,000 a year, and variable costs equal to two-thirds of revenues. If sales increase by 10%, what will be the increase in pre-tax profits?

  What is jc manufacturing final cost of the inventory

JC Manufacturing purchased inventory for $5,300 and also paid a $260 freight bill. JC Manufacturing returned 45% of the goods to the seller and later took a 2%.

  Focus on same-store sales

1) Why might companies focus on same-store sales rather than total sales?

  Which offer should harte accept

Lay out the cash flows involved in the offer on a time line. If Harte applies a required rate of return of 12% to them, what is the present value of this series of payments? A second company has offered Harte an immediate one-time payment of $100,000..

  What will occur to margin account of investor who holds one

the margin requirement on the samppasx 200 futures contract is 10 and the stock index is currently 4400. each contract

  Describe which payoff will you choose

a. If your investment rate over the next twenty years is 8%, which payoff will you choose? b. If your investment rate over the next twenty years is 5%, which payoff will you choose? c. At what investment rate will the annuity stream of $250,000 be th..

  Compute altman z score for best buy and circuit city

Compute Altman's Z-score for Best Buy and Circuit City for 2007 and 2008. How did the bankruptcy risk of Best Buy change between 2007 and 2008? Explain. How did the bankruptcy risk of Circuit City change between 2007 and 2008? Explain.

  Compute the annualized irr for loan

Suppose the index rate will remain 1% for the life of the loan. Compute the annualized IRR for this loan assuming Tim will prepay in 5 years.

  Costs of capital kept constant

What is the change in the firm's WACC if it sells 10,000 7-year zero coupon bonds ($1,000 par value) with an 8.2 percent market required rate of return

  What is the current value of your firm

Given these conditions, what is the current value of your firm? What will be the new value of your firm if it takes on $100,000 in debt?

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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