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

Pattern practices, Pattern Practices : A pattern may be defined as a repli...

Pattern Practices : A pattern may be defined as a replica or fascimile model of the desired casting which, when packed or embedded in a appropriate moulding material, creates a ca

Programming of 18F4550, #include org 0xoo movlw 0x00 ---------- movlw 0xff ...

#include org 0xoo movlw 0x00 ---------- movlw 0xff movwf PORTB end

Oscilloscope probes, Direct probe,isolation probe,high impedence probe,acti...

Direct probe,isolation probe,high impedence probe,active probe,current probe

Optics, If the light source in figure 12.1 (see figure below) of the Warren...

If the light source in figure 12.1 (see figure below) of the Warren Smith text is replaced by a 100W light bulb, and the lens aperture is 20cm, what would the 1cm detector at point

Gas Furnace, Furnace limit switches are wired in series with the?

Furnace limit switches are wired in series with the?

Weighted average cost of capital, Using this link and the information there...

Using this link and the information therein ( http://www.sec.gov/Archives/edgar/data/1110452/000119312507151600/d20f.htm#tx19738_13.) find Air France’s weighted average cost of ca

Providing alternative escape routes, Providing alternative escape routes: ...

Providing alternative escape routes: The first thing to check is if everyone can turn away from the fire and move safely away from it. For this to be the case there will

Heat transfer, #questionA piece of Al weighing 6 kg and initially at a temp...

#questionA piece of Al weighing 6 kg and initially at a temperature of 300OC is suddenly immersed in a fluid at a temperature of 20OC. The convectice heat transfer coefficient is 5

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