What is the maximum discount rate

Assignment Help Accounting Basics
Reference no: EM132783558

Question - James can invest in a project that will cost $70,000. The project is expected to pay him $95,000 after-tax in 5 years. What is the maximum discount rate, as a whole number, that he could use to evaluate the project that would yield a positive cash flow?

a) 5%

b) 6%

c) 7%

d) 8%

Reference no: EM132783558

Questions Cloud

What is one of the pitfalls of natural selection : In his article, Stephen Jay Gould points out that Darwin's natural selection only goes so far when explaining the evolution of life on earth.
Calculate the bond issue price : Assuming the market interest rate on January 1, 2021, was 4%, calculate the bond's issue price. Blossom Company issued $444,000 of 5%, 7-year bonds on January 1
Understanding and coping with change : Change is everywhere, yet very few people seem to embrace the concept. What will be done and how will you know that the plan has worked?
How does each painting reflect the religious context : Whether artists were working under the patronage of a Catholic Pope, endorsing a Counter-Reformation agenda, or producing art influenced by the Protestant.
What is the maximum discount rate : What is the maximum discount rate, as a whole number, that he could use to evaluate the project that would yield a positive cash flow
Compute the contract asset : George was billed and paid 30% on the contract price in accordance with the contract agreement. Compute the Contract Asset (Contract Liability) for 2011
What is the real? risk-free interest? rate : If the? 10-year Treasury bond rate is 6.3%?, the inflation premium is 2.2%?, and the? maturity-risk premium on? 10-year Treasury bonds is 0.3%
Which the influence of behavior-changing substances : Using drug testing to ensure that employees aren't under the influence of behavior-changing substances is an example used in the textbook of implicitly
Compute for the taxable income : Mr. Johnson had a gross compensation income of P200,000 and gross income from trading of P1,000,000. Compute for the taxable income

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture 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