A project is projected to cost $2,000,000 to undertake. It will generate positive cash inflows as follows: Year 1 - $400,000; Year 2 500,000; Year 3 - $650,000; ear 4 - 750,000; Year 5 - 800,000. What is the project's Profitability Index if the required return is 10% ?
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- Jasmine Manufacturing is considering a project that will require an initial investment of $52,000 and is expected to generate future cash flows of $10,000 for years 1 through 3, $8,000 for years 4 and 5, and $2,000 for years 6 through 10. What is the payback period for this project?POD has a project with the following cash flows: Year Cash Flows 0 -$ 281,000 145,500 123 163,000 128,100 The required return is 8.3 percent. What is the profitability index for this project?A project with an initial cost of $29,900 is expected to provide cash flows of $9,750, $11,000, $14,100, and $8,600 over the next four years, respectively. If the required return is 8.4 percent, what is the project's profitability index? Multiple Choice .994 839
- A project is projected to cost $2,000,000 to undertake. It will generate positive cash inflows as follows: Year 1 - $400,000; Year 2 500,000; Year 3 - $650,000; ear 4 - 750,000; Year 5 - 800,000. What is the project's Profitability Index if the required return is 10% ?A project is projected to have the following net income: Year 1 = $80,000; Year 2 = $40,000; Year 3 = –$30,000. The same project has an initial investment of $300,000 and will lose value at a rate of $100,000 per year. The numerator in the average accounting return method will be?A project with an initial cost of 30800 is expected to provide cash flow of 11,100 11,900, 15000 and 9500 over the next four year, respectively if the required return is 9.3 percent what is the projects profability index?
- The expected cash flows of a project are as follows. Year Cash Flow -100000, 20,000 ,30,000 40,000 ,50,000 30,000 The cost of capital is 12 per cent. Calculate the following and evaluate the project under each methods a. net present value b. Profitability Index c. Internal rate of Return d. Modified internal rate of Return and Payback periodMolin Inc. is considering to a project that will have the following series of cash flow from assets (in $ million): Year Cash flow 0 -1,580.92 1 453 2 749 3 935 The required return for the project is 6%. Year Cash flow 0 -1,580.92 1 453 2 749 3 935 1. The required return for the project is 6%. 2. What is the project's profitability index? 3. What is the internal rate of return (IRR) for this project?(Net present value, profitability index, and internal rate of return calculations). You are considering two independent projects, project A and project B. The initial cash outlay associated with project A is $50,000 and the initial cash outlay associated with project B is $70,000. The required rate of return on both projects is 12 percent. The expected annual free cash flows from each project are as follows: YEAR PROJECT A PROJECT B 0 -$50,000 -$70,000 1 12,000 13,000 2 12,000 13,000 3 12,000 13,000 4 12,000 13,000 5 12,000 13,000 6 12,000 13,000 Calculate the NPV, PI, and IRR for each project and indicate if the project should be accepted.
- You are asked to analyze the following scenario and determine its value. What it the most you would be willing to invest in this project if your required rate of return is 11%. (Assume cash flows occur at the end of each year). Cash flows Year 1-3: $150,000,000 Year 4: ($550,000,000) Year 5-10: $175,000,000 O $845,654,114 O $491,942,778 $346,568,100 $263,458,478A project will generate the following cash flows. The required rate of return is 15%. If the profitability index is 1.7, what is the initial investment for this project? Year Cash flow 1 $15,000 2 $16,000 3 $17,000 4 $18,000 5 $19,000 Select one: a. $26,217.06 b. $31,460.47 c. $32,974.98 d. $37,752.57 e. $95,297.70Assume a project has cash flows of -$54,300, $18,200, $37,300, and $14,300 for Years 0 to 3, respectively. What is the profitability index given a required return of 12.6 percent? 1.02 .95 .98 1.06 ☐ 1.00
