Npv, finance, Other Engineering

Assignment Help:
Problem 1
Suppose a company is considering two independent projects, Project A and Project B. The cash outlay for Project A is $14,000. The cash outlay for Project B is $20,000. The company’s cost of capital is 12%. The following table shows the after-tax cash flows. For each project, compute the NPV, the IRR, the MIRR, and indicate the accept/reject decision.
Year
Project A
Project B
1
$4800
$6700
2
$4800
$6700
3
$4800
$6700
4
$4800
$6700

























Problem 2
Suppose a company is considering two investment projects. Both projects require an upfront expenditure of $30 million. The company estimates that the cost of capital is 10% and that the investments will result in the following after-tax cash flows (in millions of dollars). Complete parts (a) through (e) below.

Year
Project A
Project B
1
$28
$10
2
$20
$15
3
$10
$20
4
$5
$25

Find the regular payback period for each project.
Find the discounted payback period for each project.
Assume that the two projects are independent and the cost of capital is 10%. Which project or projects should the company undertake? Base your results on the NPV.
Assume that the two projects are mutually exclusive and the cost of capital is 5%. Which project or projects should the company undertake? Base your results on the MIRR.
Explain why quantitative measures may not always be the best way to evaluate a project.

Related Discussions:- Npv, finance

Lamination of plastics, Q. Write short note on laminating.           ...

Q. Write short note on laminating.                                                 OR    Explain the Laminating processes.

Seekers , Seekers   There are two main types of sensor used in autono...

Seekers   There are two main types of sensor used in autonomous vehicles (seekers and position/attitude sensors) - although not all systems have both.            - Airc

Software design principles, explain the design should be traceable to the a...

explain the design should be traceable to the analysis model

Ts diagram, how to find points on Ts diagram?

how to find points on Ts diagram?

Fundamentals of financial management, 4-7 DuPont and Net Income Ebersoll Mi...

4-7 DuPont and Net Income Ebersoll Mining has $6 million in sales, its ROE is 12%, and its total assets turnover is 3.2x. The company is 50% equity financed, and it has no preferr

representing vectors in different axes, Representing vectors in different ...

Representing vectors in different axes All positions, velocities, momentums and accelerations are really relative positions, relative velocities, relative momentums and relativ

Composite materials - approximate stability equatation, Most vehicles have ...

Most vehicles have the XZ plane as a plane of symmetry which results in D = 0 and F = 0. Further if the disturbance velociies are small then terms proportional to the square and pr

Types of cyclic repetition blocks in dab or dvb broadcasting, Question: ...

Question: (a) Explain the three types of cyclic repetition blocks in DAB or DVB broadcasting. (b) DAB and DVB use stream and packet modes whereas MBMS uses broadcast and mu

Pn junction diode, what is the effect of temperature on pn junction diode o...

what is the effect of temperature on pn junction diode of component

Write Your Message!

Captcha
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