What is the project net present value

Assignment Help Finance Basics
Reference no: EM132441042

A project has an initial requirement of $135,258 for equipment. The equipment will be depreciated to a zero book value over the 4-year life of the project. The investment in net working capital will be $3,352. All of the net working capital will be recouped at the end of the 4 years. The equipment will have an estimated salvage value of $8,009. The annual operating cash flow is $34,616. The cost of capital is 22 percent. What is the project's net present value if the tax rate is 22 percent?

Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. If the NPV is negative, then enter the answer as an negative number. For example, if your answer is -1051.236, then enter as -1051.24.

Reference no: EM132441042

Questions Cloud

Problem in forecasting interest rates : Problem in Forecasting Interest Rates based on unbiased expectations theory
What movie and poem has most influenced in the life : What movie, poem, musical composition, or novel has most influenced your life and the way you view the world? Why did it influence you and how did it make
What is the tax liability for a single individual : What is the tax liability for a single individual with $52,000 of taxable income, which includes $2,000 of dividends?
Discuss the issues relating to modigliani and miller : Discuss the following issues relating to Modigliani and Miller's (MM) 1958 capital structure model.
What is the project net present value : A project has an initial requirement of $135,258 for equipment. The equipment will be depreciated to a zero book value over the 4-year life of the project.
What is the cash flow of the project in year 4 : What is the cash flow of the project in Year 4? That is, solve for CF4. Assume that the tax rate is 16%
Calculate Rolling Spring Projected Benefit Obligation : If no change in actuarial estimates occurred during Year 1, calculate Rolling Spring's Projected Benefit Obligation at December 31, Year 1
Discuss the Global Business Speaks in English : What about these three article discussed- communication, language, culture , english or global business?Discuss the Global Business Speaks in English
Describe the behavioral challenges in achieving efficiency : Describe the behavioral challenges in achieving efficiency in relation to efficient capital market.

Reviews

Write a Review

Finance Basics Questions & Answers

  Define the monopolist rule for the profit-maximizing output

What is the monopolist's rule for determining the profit-maximizing output? What two steps does the monopolist follow to maximize profits?

  Portfolio- buy a call and a put options on the same asset

Consider the following portfolio- buy a call and a put options on the same asset with the same strike price E. i) Derive and plot the payoff function for this portfolio. ii) Derive the final condition (time = expriry) and two boundary conditions (..

  Industry environment for a vegan food truck

Use Porter's five forces model to analyze the Industry environment for a Vegan food truck that you are thinking about opening

  Expanding the existing business by acquiring a competitor

Currently, the riskless interest rate is 8%; the corporate tax rate is 50%; the current price of a share of common stock is $20; an the dividends have been level at $1 per share per year for many years. Recently, company executives have considered ex..

  Determine how much he would have saved if the interest

Determine how much he would have saved if the interest is compounded in each of the following ways?

  Containing green balls are consecutively numbered

There are 6 boxes number 1, 2, ...6. Each box is to be filled up either with a red or a green ball in such a way that at least 1 box contains a green ball and the boxes containing green balls are consecutively numbered. The total number of ways in..

  What some views about whether discretionary employee benefit

What some views about whether discretionary employee benefits should be an entitlement or something earned based on job performance.

  Required rate of return on equity

If Holland acquires Workman, it will increase the debt to 60%, at an interest rate of 9%, and the tax rate will increase to 35%. The risk-free rate is 6% and the market risk premium is 4%. What will Workman's required rate of return on equity be a..

  Excess reserves in the financial system

Suppose there is $400 billion of currency in circulation in the economy outside the banking system, that depository institutions in the economy have $800 billion in checkable deposits,

  What is the bond current yield

The bond pays coupons semiannually. What is the bond's current yield?

  Explain cultivation theory and the mean world syndrome

How film studies have evolved over the years and explain the research of two scholars reviewed thus far over this textbook and explain two theories reviewed thus far over the textbook

  Determine the number of contracts

1. Give a proof of the hedge ratio φf as obtained in equation (11.4). 2. Determine the number of contracts φf he has to sell.

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