What is the projects net present value

Assignment Help Financial Management
Reference no: EM13947534

The firm has a 75% chance if it invests -$1,500 a return of $500 for 7-years, and a 25% chance of returning $25 for 7-years. Based on the above data, what is the project's net present value?

-$1,312,456

-$1,104,607

-$875,203

$105,999

$321,788

Reference no: EM13947534

Questions Cloud

How much is your payment for the home : You are purchasing a home for $200,000 with a 20% down payment. You will pay 6% interest, for a 15 year loan. How much is your payment for the home (insurance is $60 per month and taxes are $85 per month.) What is your principle, interest and balance..
Explain and describe software licensing. : Which applications are you likely to use in the course of taking classes online?
Build a spreadsheet with the semi-annual coupon cash flows : Find a bond that has a negative after-tax yield. Recommend an alternative with similar risk, but better tax treatment - Build a spreadsheet with the semi-annual coupon cash flows.
Suppose a change in expectations regarding future : Suppose a change in expectations regarding future U.S. inflation causes the expected future spot rate to decline to $1.52:£1. What should happen to the U.S. interest rate?
What is the projects net present value : The firm has a 75% chance if it invests -$1,500 a return of $500 for 7-years, and a 25% chance of returning $25 for 7-years. Based on the above data, what is the project's net present value?
Create the files named below : Also please check what I wrote in the Short Account and if you think that something else is required in the Short Account, please change it or suggest what should be changed.
What is the accounting rate of return : What is the accounting rate of return? Compute the accounting rate of return for an investment that requires an initial outlay of $300,000 and promises an average net income of $100,000.
Inside air temperature when outside air temperature : Assuming that the occupants' body heat provides a continuous source of 320 W within the igloo, calculate the inside air temperature when the outside air temperature is Too  = -40 C. Be sure to consider heat losses through the floor of the igloo.
What was the real u.s. dollar cost : At the same time, the exchange rate changes from FF 1 = $0.15 on January 1 to FF 1 = $0.10 on December 31. What was the real U.S. dollar cost of borrowing francs for the year?

Reviews

Write a Review

Financial Management Questions & Answers

  Assume the risk-free rate and the beta remain unchanged

Stock has a required return of 12%; the risk-free rate is 3.5%; and the market risk premium is 6%. What is the stock's beta? If the market risk premium increased to 7%, what would happen to the stock's required rate of return? Assume the risk-free ra..

  The discounted payback period for the cash flow

The discounted payback period for the cash flow in question 6.15 is:

  Arrearages are unpaid preferred dividends

A convertible bond gives the bondholder the right to exchange the bonds for a preset number od shares of stock. a warrant is a security that often sold with bonds but that can be detached (bought and sold separately) from the bond. most preferred sto..

  Returns on crash-n-burn computer stock over past five year

You've observed the following returns on Crash-n-Burn Computer's stock over the past five years: 2 percent, -12 percent, 16 percent, 22 percent, and 18 percent. What is the variance of these returns?

  A low quality field may have a positive cash flow

A low quality field may have a positive cash flow, but still be classified as having a less desirable present value. What is a factor that contributes to this analysis?

  How much interest are you paying implicitly

You place an order for 540 units of inventory at a unit price of $170. The supplier offers terms of 2/15, net 60. a-1 How long do you have to pay before the account is overdue? Days until overdue days a-2 If you take the full period, how much should ..

  Ethics codes apply to project selection-capital budgeting

Financial executives insist that there should be no separation between an individual's personal ethics and his or her business ethics. How do ethics codes apply to project selection and capital budgeting? What are the potential risks to a company of ..

  Discuss some of the primary risks the company faces

Identify and discuss some of the primary risks the company faces in the near future and create a table showing the stock prices for the past five years

  Extended disbursement float-disbursement schedule

If average daily remittances are $1 million, and "extended disbursement float" adds 10 days to the disbursement schedule, how much should the firm be willing to pay for a cash management system if the firm earns 11% on excess funds.

  Find what is the project''s net present value

The initial cost of the fixed assets is $61,000. These assets will be worthless at the end of the project. An additional $4,500 of net working capital will be required throughout the life of the project.

  Plans to an all-equity plan assuming that EBIT

Kolby Corp. is comparing two different capital structures. Plan I would result in 15,000 shares of stock and $100,000 in debt. Plan II would result in 11,500 shares of stock and $170,000 in debt. what are the break-even levels of EBIT for each plan a..

  What would the total present value of the bond be

If a group has just issued a $100,000 par value bond paying 6% interest with 8 years til maturity. Assuming the current yield on the bond is 10%, what would the total present value of the bond be? How this would be solved

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