[4] Each of three mutually exclusive projects costs $200. Using the table provided, rank theprojects in descending NPV order.Present ValueProjects’ Cash FlowА В СInterest FactorYear(10%)1.91$300 $200 $ 02.832001001003.751001004.68100200.62200300А. В, А, С.В. А, В, С.С. С, В, А.D. A, C, B.

Project cost = $ 200 Interest rate = 10%

[4] Each of three mutually exclusive projects costs $200. Using the table provided, rank the projects in descending NPV order. Present Value Interest Factor Projects’ Cash Flow Year (10%) А В С 1 .91 $300 $200 $ 0 2 .83 200 100 100 3 .75 100 100 4 .68 100 200 5 .62 200 300 А. В, А, С. В. А, В, С. С. С, В, А. D. A, C, B.

[4] Each of three mutually exclusive projects costs $200. Using the table provided, rank the projects in descending NPV order. Present Value Interest Factor Projects’ Cash Flow Year (10%) А В С 1 .91 $300 $200 $ 0 2 .83 200 100 100 3 .75 100 100 4 .68 100 200 5 .62 200 300 А. В, А, С. В. А, В, С. С. С, В, А. D. A, C, B.

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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[4] Each of three mutually exclusive projects costs $200. Using the table provided, rank the projects in descending NPV order. Present Value Projects’ Cash Flow А В С Interest Factor Year (10%) 1 .91 $300 $200 $ 0 2 .83 200 100 100 3 .75 100 100 4 .68 100 200 5 .62 200 300
The following are the cash flows of two projects: Project B Year Project A 0 $ (235) $ (235) 115 135 115 135 115 135 115 1234O 1 2 3 4 What are the internal rates of return on projects A and B? Note: Enter your answers as a percent rounded to 2 decimal places. Project A B IRR % %
15. Suzanne's Cleaners is considering a project that has the following cash flow data. What is the project's payback? Year 1 2 3 Cash Flows 1100 300 310 320 4 330 340 А. 2.56 уrs. В. 2.85 уrs. С. 3.16 уrs. D. 3.52 yrs.
Consider the following two projects: Project Year 0 Year 1 Year 2 Year 3 Year 4 Discount Cash Flow Cash Flow Cash Flow Cash Flow Cash Flow Rate A – 100 40 50 60 N/A 0.1 В - 73 30 30 30 30 0.1 The net present value (NPV) of project B is closest to: А. 24.3 В. 55.2 С. 27.6 D. 22.1
You are given the following cash flow for a project, and told that PW(8%) = $8,300 for this project. What is the value of the unknown payment X for the second and third periods? n Cash Flow 0 -$36,000 1 $0 2 $X 3 $X O Cannot be determined. O $24,842.08 O $26,829.44 O $5,026.74
6. You are choosing between two projects. The cash flows for the projects are given in the following Data table ($ million): Project Year 0 Year 1 Year 2 Year 3 Year 4 A −$48 $27 $19 $22 $15 B −$100 $22 $39 $48 $62 The IRR for project A is __________________________%. (Round to one decimal place.) The IRR for project B is____________________________%.(Round to one decimal place.) If your discount rate is 5.4%, the NPV for project A is $_______________million.(Round to two decimal places.) If your discount rate is 5.4%, the NPV for project B is $______________ million.(Round to two decimal places.) NPV and IRR rank the two projects differently because they are measuring different things. ___________________is measuring value creation, while ___________________is measuring return on investment. Because returns do not scale with different levels of investment, the two measures may give different rankings when…
Consider cash flows for the following investment projects (MARR Q2. Suppose that projects are mutually exclusive. Which project would you select based on AE criterion? 15 %). Project A Project B -3500 ProjectC -3000 -4000 1 1400 1100 1500 2. 1650 1000 1500 1300 1000 1800 4 750 1000 1800
Compute the internal rate of return for the cash flows of the following two projects. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) Year Project A 0 -$13,800 Project B -$ 11,400 1 5,400 2,900 2 6,200 8,500 3 5,000 4,600 Project A Project B % %
Consider the following two mutually exclusive projects: Year Cash Flow (X) Cash Flow (Y) 0 $20,000 $20,000 1 8,850 10,100 23 9,100 7,800 8,800 8,700 Calculate the IRR for each project. (Round your answers to 2 decimal places. (e.g., 32.16)). IRR Project X Project Y % % What is the crossover rate for these two projects? (Round your answer to 2 decimal places. (e.g., 32.16)). Crossover rate %
Consider two mutually exclusive projects A and B: Project Cash Flows (dollars) NPV at 12% Co C 0 C1 C 1 C2 C 2 A-35,500 25,400 25,400 + $7,427 B -55,500 38,500 38,500 +9,567 Calculate IRRS for A and B. Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.
3. The cash flows for three different alternatives are given in table below. If MARR is set at 8%, use incremental analysis between (Y and Z), (Y and X) to determine which is the best alternative? Data Alt. X Alt. Y Alt. Z Initial Cost, S Net Benefits/ Year, S 528 Life, Years 12,500 7,500 1,063 25 9,000 510 25 25
Compute the NPV for Project X with the cash flows shown below if the appropriate cost of capital is 11 percent. Time: 0 1 2 3 4 5 Cash flow: -115 -115 0 180 155 130 Multiple Choice О $83.12 О $92.26 О $310.87 О $151.88

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