PROBLEM NO.5 Solve for ERR if 25% Mimimum Attractive Rate of Return 13% Interest Rate External $7,250.00 Excess Expenditure EOY 1 $13,500.00 Investment Capital $4,850.00 Annual Excess of receipts over expenses from E
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- Module 02 Written Assiqnment Application of Future Value and Present Value.xlsx - OpenOffice Calc File Edit View Insert Format Iools Data Window Help ABC 《 的, ABC Verdana 10 В I U 三 開 % 0 □ A B G H I 1. Assume an investment of $2,000 today. Calculate the FV of the investment according to eac 6. 7 a. 6 percent compounded annually 8 9. Rate 6% 10 Nper PMT 12 11 12 PV $2,000.00 $0.00 13 FV 14 15 b. 8 percent compounded annually 16 17 Rate 8% 18 Nper 12 19 PMT 20 PV $2,000.00 21 FV 22 23 c. 10 percent compounded annually 24 25 Rate 10% 26 Nper 12 27 PMT 28 PV $2,000.00 29 FV 30 31 d. 10 percent compounded semiannually 32 Rate K Future Value Present Value 33 10% STD Sheet 1/2 PageStyle Future ValueSpreadsheet Link What is the IRR of the following project? Cash Flow Year 0 32.000 9,000 1. 2 10,000 15,200 7,800 4. 1) 10.8% 2) 11.2% • 3) 11.7% 4) 12.0% 5) 12.3% 234Question 9 - Chapter 09 Problem X zto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launch Url=https%253A%252F%252Flms.m apter 09 Prob x r09 Problem Seti 2:50 ed k ces Consider the following two mutually exclusive projects: Year Cash Flow (X) Cash Flow (Y) -$ -$ 0 1 2 3 20,800 9,050 9,500 9,000 Project X Project Y 20,800 10,500 8,000 8,900 Crossover rate Calculate the IRR for each project. (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) H Homework Help Websites for Col x % % What is the crossover rate for these two projects? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) % Saved n
- NPV profiles WACC (Dollars in Millions) Plan A Plan B Project NPV Calculations: NPVA NPVB Project IRR Calculations: IRRA IRRB NPV Profiles: Discount Rates 0% 5% 10% 15% 20% 22% 25% 11.00% NPVA $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 0 -$40.00 Formulas #N/A #N/A -$11.00 $2.47 $2.47 $2.47 #N/A #N/A NPVB 1 $6.39 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 2 3 $6.39 $6.39 4 $6.39 $2.47 5 6 7 $6.39 $6.39 $6.39 $2.47 $2.47 8 9 $6.39 $6.39 $2.47 $2.47 $2.47 10 $6.39 $2.47 11 $6.39 12 $6.39 13 $6.39 $2.47 $2.47 $2.47 14 $6.39 15 $6.39 $2.47 $2.47 16 $6.39 $6.39 $2.47 17 39 $2.47PROBLEM 2-Determine the External Rate of Return, i' Discount Rate=5% Cashflow PV-Cash Outflow PV-Cash Inflow Year (P27,500) 6,000 8,000 7,000 (4,000) 9,000 5,000 4 2 1 %3D O123456Exhibit 2.3A Examp'e Comparing Two Projects Using the Payback Method Project A Project B Formulas Investment Annual saving 5750,000 5215,000 $250.000 580,000 Project A Payback 07/D8) Project B Payback (7/P8) Payback Period" Rate of Return"* Project A: Rate of Return (06/D7) Project D. Rate of Return (F8/P7) Accept/Reject Exclanetion Project A Accept/Reject Accept is Payback<5 Years and Rate of Return 15% Project B * Note: Parbnck does not use she time valce of money ** Note: Rate of returnis reciprocalof Fayback
- Investment Perlod 1 2 3 4 5 $(1,000) $100 264 A $100 $100 $100 $1,100 в (1,000) 264 264 264 264 (1,000) 1,611 1. Compute the net present value for each of the following cash flow sequences. Assume a cost of money of 10 percent. 3. Compute the payback for each of the cash flows in problem 1. If the maximum acceptable payback period is four years, which (if any) of the cash flows would be accepted as a desirable investment? 4. Assume a cost of money of 5 percent. Compute the net present values of the cash flows of problem 1. 5. Assume a cost of money of 15 percent. Compute the net present values of the cash flows of problem 1. Compare with the results obtained from problems 1 and 4. 6. The Arrow Company is considering the purchase of equipment that will return cash flows as follows: End of period Cash flows $5,000 2 3 3,000 2,000 1,000 500 5 Assume a cost of money of 10 percent. What is the maximum amount the company could pay for the machine and still be financially no worse off than if…id 1 :uonsenn siu i 29 o Consider the following two projects: Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Discount Project C/F Alpha C/F C/F C/F C/F C/F C/F C/F Rate -79 20 25 30 35 40 N/A N/A 12% Beta - 80 25 25 25 25 25 25 25 13% The net present value (NPV) for project alpha is closest to: A. $31 B. $25 OC. $21 D. $38 Click to select your answer. MacE esc D00 O O O 0Details WACC 0 SGWN-O 1 2 3 4 5 6 7.80% Project A Project B -1225 395 402 423 432 489 512 -2146 592.5 603 634.5 648 733.5 768 1. Construct NPV profile table by using cashflows from Project A and B above. 2. Draw NPV profile 3. Compute crossover rate To receive EC your work has to be done in Excel.
- Asset End of year Amount Appropriate Required Return D 1 through 5 $1,500 12% 6 $8,500 Cash Flow By using cell references to the given data and the function PV, Calculate the value of asset D.Match the following measurements with the terms below: Question 15 options: 12345 cash conversion efficiency ratio 12345 economic ordering quantity 12345 credit terms 12345 net working capital 12345 days of working capital 1. 5.1% 2. 47.2 days 3. 1/10, n/30 4. $200,000 5. 700 unitsQuestion 4: Consider projects A and B: Cash Flows (dollars) Project CO C2 NPV at 11% C1 22,600 22,600 +$6,703 35,000 35,000 +7,938 A -32,000 B -52,000 a. Calculate IRRs for A and B. b. Which project does the IRR rule suggest is best?
