The Hudson Corporation makes an Investment of $68,100 that provides the following cash flow: 1 2 3 Cash Flow $34,000 34,000 22,000 Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. a. What is the net present value at a discount rate of 11 percent? (Do not round intermediate calculations and round your answer to 2 decimal places.) Net present value b. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Internal rate of return c. Would you make the same decision under both parts a and b? Yes O No
The Hudson Corporation makes an Investment of $68,100 that provides the following cash flow: 1 2 3 Cash Flow $34,000 34,000 22,000 Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. a. What is the net present value at a discount rate of 11 percent? (Do not round intermediate calculations and round your answer to 2 decimal places.) Net present value b. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Internal rate of return c. Would you make the same decision under both parts a and b? Yes O No
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Both appendixes are the same so I just attached 1 (b)
Transcribed Image Text:The Hudson Corporation makes an Investment of $68,100 that provides the following cash flow:
Lear
1
Cash Flow
$34,000
34.000
22,000
Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator
methods.
a. What is the net present value at a discount rate of 11 percent? (Do not round intermediate calculations and round your answer to 2
decimal places.)
Net present value
b. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal
places.)
Internal rate of return
%
c. Would you make the same decision under both parts a and b?
Yes
O No
Semprev
5 at 9
BEE
Next >
Transcribed Image Text:The Hudson Corporation makes an Investment of $68,100 that provides the following cash flow:
Lear
1
Cash Flow
$34,000
34.000
22,000
Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator
methods.
a. What is the net present value at a discount rate of 11 percent? (Do not round intermediate calculations and round your answer to 2
decimal places.)
Net present value
b. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal
places.)
Internal rate of return
%
c. Would you make the same decision under both parts a and b?
Yes
O No
Semprev
5 at 9
BEE
Next >
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