A project has the following cash flows. What is the internal rate of return? Years Cash flow -$46.800 11,260 2 18.220 15.950 13,560 O 9.75 percent O 10.28 percent O 10.60 percent O 10.67 percent O 11.23 percent 34

Q: A mechanical contractor is trying to calculate the present worth of personnel salaries over the next...

A: given that: interest rate= 12%= 0.12 n (no. of period)= 5 years 1st year salaries=$150000 (S) since ...

Q: 1. Discuss: Firms often involve themselves in projects that do not result directly in profits. For e...

A: Direct profit is defined as the amount of money earned from sales after deducting direct costs. This...

Q: Daisy invested 37000 Australian dollars (AUD) in a fixed deposit account with an annual a) 37000 x (...

A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first ...

Q: John's cafe is considering the purchase of a waffle maker that cost $10,000. The waffle maker has an...

A: Net present value (NPV) is the value of all the cash flow of the investment (positive and negative) ...

Q: Consider the decision of whether to hold wealth as money or as an interest-earning asset that pays a...

A: The nominal interest rate is the rate that we get before any adjustments are made. The real rate is ...

Q: P8-2 Risk versus Return Rank the following three stocks by their risk-return relationship, best to w...

A: Solution:- Risk-return relationship means the ratio of risk to the return of a stock. Risk is measur...

Q: Question 3 What is the price of Thera Corpn's zero coupon bond with 10 years to maturity? The bond w...

A: Present Value can be calculated using PV function in excel   PV (rate, nper, pmt, [Fv], [type]) Rat...

Q: A 5-year project will require an investment of $100 million. This comprises of plant and machinery w...

A: NPV is the difference between present value of all cash inflows and initial investment NPV =PV of al...

Q: 4. Calculating AAR You're trying to determine whether or not to expand vour business by building a n...

A: The accounting rate of return is the rate of return which is expected from the investment made by th...

Q: Debit cards allow an individual to transfer funds directly in a checkable account to a merchant with...

A: Debit card transactions involve the transfer of funds from a bank account. The checkable deposit, no...

Q: Macrohard Software is considering a new project whose data are shown below. The equipment that would...

A: Operating cash flow means the total amount of cash flow generated by the company from its business o...

Q: 4. _______ is the act of paying out includes money paid out to run a business, cash expenditure and ...

A: Disbursement – it means paying out. It can be used to describe money paid into running a business bu...

Q: Refuse, Inc. just paid a dividend of $2. Refuse expects dividends to grow at 4% indefinitely The etu...

A: Share price Share price is the current market price of the share. It is the price of the share at wh...

Q: What is the Macaulay duration of a bond with a coupon of 5.8 percent, eleven years to maturity, and ...

A: The weighted average term to maturity of a bond's cash flows is known as the Macaulay duration. The ...

Q: Which of the following statements is CORRECT? Assume that the project being considered has normal ca...

A: WACC is the required rate of return, where as IRR is the actual rate of return of the project. NPV i...

Q: . A civil engineer plans to own a 300 m² lot after 5 years for an estimated cost of 570,000. To accu...

A: When a number of payments or receipts of equal amount is made at equal intervals of time, it is call...

Q: If you invest your P3,000 every year at 4% interest rate, how many months does it take to be worth P...

A: Future Value: The future value is the amount that will be received at the end of a certain period. T...

Q: A 5-year project will require an investment of $100 million. This comprises of plant and machinery w...

A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first ...

Q: Ann got a 30 year Fully Amortizing FRM for $1,000,000 at an annual interest rate of 6% compounded mo...

A: it is given that Loan amount - $ 1,000,000 Interest – 6% Payment frequency – 12 – monthly Time – 30 ...

Q: Eight years ago, Ohio Valley Trucking purchased a large-capacity dump truck for $110,000 to provide ...

A: Purchase price of truck is $110,000 Time period 8 years Per year maintainance cost is $12,200 Resale...

Q: A firm is considering the installation of an automatic data processing unit to handle some of its ac...

A: To determine whether a company should buy or lease a machine In both cases, we must compute the mach...

Q: Lucy bought a house for $100,000. Lucy's annual cost of ownership net of tax savings is exactly equa...

A: Cost of House  $1,00,000.00 LTV 80% Buying Cost  5% Selling Cost 8% Annual Growth rate 4.50%

Q: Capi of PHP 1.5M. The manufacturing company can produce an annua evenue of PHP250,000 for 7 years, b...

A: If the net present value is positive than project is acceptable and if the net present value is nega...

Q: Electric-powered forklift truck   Gas-powered forklift truck NPV $              $            IRR   %...

A: Net Present Value (NPV) is defined as the value that can be arrived at by subtracting the present va...

Q: r expected return on this investment?

A: Expected return on investment refers to the rate of return that an investor is expecting on an inves...

Q: Jim has an annual income of $300,000. Jim is looking to buy a house that has monthly property taxes ...

A: Here,

Q: You receive a tax slip from your Canadian mutual fund showing $1,000 of capital gains, $100 of divid...

A: Capital gains and dividend income show that the equity investment is made through the fund.

Q: The estimated cost of the long-term investment project is P50 million. The expected dividend on ordi...

A: The cost of ordinary share can be calculated using the Gordon Model. Cost of ordinary share using Go...

Q: What is the nominal rate if the effective rate is15.32% compounded semi-annually?

A: Effective annual rate (EAR) refers to a real interest rate which an investor is expect from his inve...

Q: A monthly deposit of R161 is made once a month into an account at an interest rate of 18% pa compoun...

A: Monthly deposit (M) = R 161 r = 18% per annum = 1.5% per month n = 13 deposits

Q: Quantitative Problem 2: You and your wife are making plans for retirement. You plan on living 25 yea...

A: While calculating, the amount required in the retirement account, we are required to calculate the f...

Q: I borrow a 500,000 at 15% compounded annually, and he agree to pay the loan in 18 equal annual payme...

A: Loan amount (PV) = 500,000 Interest rate (r) = 15% Number of annual payments (n) = 18

Q: Name Five factors of a firm's board of directors an analyst should examine

A: Board of directors is very important in company because every decision making is done by management ...

Q: Koenma borrows 500,000 at 15% compounded annually, and he agree to pay the loan in 18 equal annual p...

A: Borrowed amount (PV) = 500,000 Interest rate (i) = 15% Period (t) = 18 Years  

Q: P8-1 Expected Return Given these three economic states, their likelihoods, ane potential returns, co...

A: Expected return is average return considering the different probabilities of different returns.

Q: Suppose the Schoof Company has this book value balance sheet:   Current assets   $30,000,000   Cur...

A: Given, Capital sources as follows: Notes payable Long term debt and common equity.  

Q: Describe how NPV is calculated and describe the information this measure provides about a sequence o...

A: NPV net present value is very important factor in deciding the feasibility analysis of projects. It ...

Q: Basic Opfion Strafegies Profif Computation Assume the below prices for calls and puts: Call Put Stri...

A: Call option A call option gives its holder the right to purchase the stock at the strike price. With...

Q: A stock costs $80 and pays a $2 annual dividend. If you expect to sell the stock after four years fo...

A: The required return on the stock represents the total return earned on the stock. This return is con...

Q: A bank makes a 30 year Fully Amortizing FRM for $2,000,000 at an annual interest rate of 4.125% comp...

A: Here, Annual Interest Rate on Loan is 4.125% Time Period of Loan is 30 years FRM Amount is $2,000,00...

Q: 1. A P3000 loan was originally made at 8% simple interest for 4 years. At the end of this period the...

A: Simple interest is a straightforward method of calculating how much money you owe on a loan. To calc...

Q: Compute the present value for each of the following bonds a. Priced at the end of its fifth year, a ...

A: To Find: Present Value of Bonds

Q: A market research firm with current sales of $750 does not expect any growth in sales for the next t...

A: Current Sales are $750 Growth rate in sales is 0% for next 2 years Tax rate is 34% Straight line dep...

Q: Determine the future worth of P6000 at exact simple interest rate of 11% from January 12, to Oct. 5,...

A: Present value (PV) = P6000 Interest rate (r) = 11% Period (d) = 267 days Days in a year = 366

Q: Cross-Ocean Boats Ltd. is in the 30% tax bracket. It is interested in determining the minimum return...

A: Here, Details of Bonds: Details of Equity Shares: Details of Preference Shares:  

Q: Task 1. Compute the interest of the following: 1. P25,000 at 6% simple interest for 1 year. 2. P30,0...

A: 1) Principal (P) = P 25000 r = 6% n = 1 year

Q: A condominium unit can be bought at a  down payment of P150,000and a monthly payment of P10,000 for ...

A: Down payment (D) = P 150000 Monthly payment (M)  = P 10000 n = 10 years = 120 payments r = 12% per a...

Q: Duration is a measurement of a bond’s interest rate risk. It is also referred to as the responsivene...

A: Bond duration or duration of the bond means the price sensitivity of the bond when the interest rate...

Q: A 5-year project will require an investment of $100 million. This comprises of plant and machinery w...

A: Formula's Calculations:

Q: Question 3 What is the price of Thera Corpn's zero coupon bond with 10 years to maturity? The bond w...

A: Present Value can be calculated using PV function in excel   PV (rate, nper, pmt, [Fv], [type]) Rat...

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.