Internal rate of return

lists shown that the project of Strategic Acquisition should be accept by the board directors, because it has a highest IRR and NPV, the second high Profitability Index and 5 years payback, although the initial investment is really big but still the return is worse to do. The total investment of this project will be EUR55 million. The second recommend project will be the project of Southward Expansion. This project has a high IRR and NPV, the initial investment is EUR30 million, it is the 3rd in the

What annual interest rate is needed to produce $200,000 after five years if only $100,000 is invested? R=14.87% FV = PV x (1 + i)n $200,000 = $100,000 x (1 + .1487)5 $200,000 = $100,000 x 2.0000 FV $200,000 = $200,000 4. Now consider a second alternative for

The company started an incentive system in 1997, under which the pay of the managers of the 8 major business units was linked to their respective return on investment targets. By the end of 1997, due to Messier being at the head of the company, the stock price had an appreciation of about 71.8% which lead to a high shareholder value. III. Alternative strategies Upon studying the key

current net margin is a healthy 20%, compared with 20.9%, so there has been little change to the bottom line. This means that again the stories of Garmin's demise were greatly exaggerated. Another set of metrics is the investment return metrics. With these, Garmin has a return on equity of 16.65%, and a five-year average ROE of

systems analysis Frances Wu, Inola zeng, JIAN QIN, mOHAMODE zATMAH It is recommended that EIS purchase the Pathrite System, since the expected value of the net present value of the project is positive, no matter we consider the CCA rate or not. 1. Weighted Average Cost of Capital calculation and analysis The overall method used to calculate the expected value of the net present value of the project is to first calculate the real weighted average cost of capital of the firm

Corporate Finance Notes * Chapter One: Introduce to Corporate Finance 1. Three Questions: A. What Long-term asset should be invested? Capital Budgeting B. How to raise cash for capital expenditures? Capital Structure C. How to manage short-term cash flow? Net Working Capital 2. Capital Structure: Marketing Value of Firm = MV of Debt + MV of Equity 3. Finance perspect and Accountant perspect: Finance: Cash Flow ! Accountant: A/R means profit ! 4. Sole proprietorship

the end of year-1 (D1) and these dividends are expected to grow at a constant rate of 6% per year forever. If the required rate of return on the stock is 18%, what is current value of the stock today? a. $25 b. $50 c. $100 d. $54 2. MJ Co. pays out 60% of its earnings as dividends. Its return on equity is 15%. What is the stable dividend growth rate for the firm? a. 9% b. 5% c. 6% d. 15% 3. If the discount rate is stated in real terms, then in order to calculate the NPV in a consistent manner

* Our idea: Our business idea is not a newfound product or a yet to be explored market, it is an existing business with 100% competition. In a nutshell, our business idea is to open a flower shop catering to deliveries, formalities and small-scale events. Our objective is to be accessible and convenient whilst offering above par products. We came up with this idea through our love for flowers and the slight experience and skill we have in this field. It is a beautiful market with ability to

calculating the market value of equity. 8. All investors will receive their required rate of return. 9. As the WACC decreases due to the cost advantage of debt, the present value of the cash flows generated by the project will increase, consequently the NPV of the project will increase. 10. The lowest acceptable

* Question 1 0 out of 10 points | | | Below is an excerpt from the cash flow statement of a firm for fiscal year 2003: Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Amortization of software Tax benefits of employee stock plans Special charges (Gains)/losses on investments Change in operating assets and liabilities: Receivables Inventories Pension assets Other assets Accounts