User Account

All Pages

What is the net present value

Assignment Help Finance Basics
Reference no: EM131721778

A company is considering a 6-year project that requires an initial outlay of $21,000. The project engineer has estimated that the operating cash flows will be $4,000 in year 1, $6,000 in year 2, $7,000 in year 3, $7,000 in year 4, $7,000 in year 5, and $7,000 in year 6. At the end of the project, the equipment will be fully depreciated, classified as 5-year property under MACRS. The project engineer believes the equipment can be sold for $6,000 at the end of the project. If the tax rate is 37% and the required rate of return is 12%, what is the net present value (NPV) of this project?

Reference no: EM131721778

Questions Cloud

Calculate the effective cost rate of each sources of funds : Calculate the effective cost rate of each of these sources of funds for Interstate and make a management decision on what sources to use.
Determine the cost of internal equity capital : Determine the cost of internal equity capital using the dividend capitalization model approach. (Compute answer to the nearest 0.1%).
Five things to secure a vehicles computing system : Five things recommended to Secure a vehicles computing system
Should job postings be highly detailed about nature of job : Should job postings be highly detailed about the nature of the job and skills expected to perform the job functions, or should they only be broad descriptions?
What is the net present value : If the tax rate is 37% and the required rate of return is 12%, what is the net present value (NPV) of this project?
What interest return will abc insurance earn : Bank Three of Florida issues a three-month (90-day) negotiable CD in the amount of $20 million to ABC Insurance Company at a negotiated annual interest rate.
What happens if your idea of quality differs : What happens if your idea of quality differs from the customer's idea of quality - How can you relay the importance of meeting this level of quality
Choosing between buying and selling interest : To capitalize on your expectation, you should be selling (as opposed to buying) interest rate (i.e., Treasury bond) futures."
Calculate the total interest income earned by morgan : Washington Mutual borrowed $150 million in Fed funds from J. P. Morgan Chase Bank in New York City for 24 hours to fund a 30-day loan.

Reviews

Write a Review

Finance Basics Questions & Answers

  Required rate of return

The required rate of return is 20 percent. The net present value is?

  Describe tax issues while transferring property

Describe Tax issues while transferring property from proprietorship business to a corporation and What are the tax issues for Polly and Flycatcher

  Calculate to know if you should invest

Explain what Risk &Return  means in 7 to 10 PP slides.Have to show I understood risk and return well what it is and  what you have to calculate to know if you should invest or not how to minimize risk

  The owner of a popular ice cream shop

Imagine that you recently became the owner of a popular ice cream shop. You want to attract more customers and ultimately expand the business. Choose the type of production process-continuous or intermittent-you think would best fit your business.

  What is the target share price five years from now

Davis, Inc., currently has an EPS of $1.40 and an earnings growth rate of 7 percent. If the benchmark PE ratio is 31, what is the target share price five years from now?

  Determine the annual net cash cost of borrowing

Ron's Pharmacy has collected $600 in sales taxes during the March. If sales taxes must be remitted to state government monthly, what entry will Ron's Pharmacy create to demonstrate the March remittance?

  The managers of a food company are interested in

the managers of a food company are interested in determining the effect on their sales of a competitors television

  Access investopedia-markets-sectors

Access Investopedia-Markets-Sectors (Links to an external site.) Write a 3-5 page paper in APA format (minimum of two references) comparing and contrasting the Best Performing Sectors and the Worst Performing Sectors (displayed as two tables at the ..

  Has the dollar appreciated or depreciated against the yen

If the exchange rate between the yen and the dollar changes from ¥80 = $1 to ¥90 = $1, has the yen appreciated or depreciated against the dollar? Has the dollar appreciated or depreciated against the yen?

  Afirm with net income of 80000 pays out 32 of net income

a firm with net income of 80000 pays out 32 of net income individends. if the firm has 40000 shares of common stock

  Financial system and financial systems

During the summer and fall of 2008, the U.S. financial system and financial systems around the world appeared to be on the verge of collailpse.

  Formulate a linear programming model

Formulate a linear programming model that can be used to determine the percentage that should be allocated to each of the possible investment alternatives.

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