Assume you are risk-averse and have the following three choicesExpectedValue$ 2,200StandardDeviation$ 1,440ProjectABC2,7302,250ProjectABC1,9601,490a. Compute the coefficient of variation for each.Note: Round your answers to 3 decimal places.Coefficient ofVariationb. Which project will you select?O Project AO Project BO Project C

Coefficient of variation computed as follows:-Coefficient of variation =

Assume you are risk-averse and have the following three choices Standard Deviation $1,440 1,960 1,490 Project A B С Expected Value. $ 2,200 2,730 2,250 a. Compute the coefficient of variation for each. Note: Round your answers to 3 decimal places. Project A B C Coefficient of Variation b. Which project will you select? O Project A O Project B O Project C

Assume you are risk-averse and have the following three choices Standard Deviation $1,440 1,960 1,490 Project A B С Expected Value. $ 2,200 2,730 2,250 a. Compute the coefficient of variation for each. Note: Round your answers to 3 decimal places. Project A B C Coefficient of Variation b. Which project will you select? O Project A O Project B O Project C

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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A. Calculate the profitability index for project X. B. Calculate the profitability for project Y C. Using the NPV method combined with the PI aporoach, which project would you select? Use a discount rate of 13 percent
Given the following two mutually exclusive projects, always choose Project A (the project with a higher IRR). Project NPV IRR A $100 10.5% B $150 9.5% Group of answer choices True False
b) Using data provided below, compute appropriate values and fill the table below to help identify the least risky and most risky project among alternatives A, B and C using appropriate criteria. Project EV D D2 Var St. dev Coef.0f Var TT 12 0.2 A 18 0.7 28 0.1 10 0.3 В 22 0.6 32 0.1 11 0.1 C 21 0.8 31 0.1 Where n denotes the profit, P is the probability, EV stand for Expected value, D is the Deviation, D$ denote the deviation square, St. dev is the standard deviation and finally Coef.of Var is the coefficient of variation.
Answer this question as it is pertaining to two MUTUALLY EXCLUSIVE projects on the following figure. Given r=6%, which project would you choose if you decide to use the internal rate of return (IRR) as the criterion? Group of answer choices Project A Project B Neither Either
Consider two project alternatives, project I and project II, with their payoffs and their associated probabilities outlined in the following table: Project I Project II Payoff 10 15 20 Probability 0.1 0.8 0.1 Payoff 1. Compute RRI for each project; 2. Would you select project I or project II? Why. 5 10 14 Probability 0.2 0.3 0.5
A public decision-maker has a budget of $30m which must be spent in the current year. Three independent and indivisible projects were proposed. Each project has a 5 years life. The following table lists the capital cost of each project and their respective annual benefits. The discount rate is 10%. Initial capital costs 12m 10m 17m ANNUAL Benefits 4.3m 4.2m 5.8m Projects A (school) B (Hospital) C (Road) a. List the possible combinations of projects, given the above budget
Suppose that you found the probabilities and expected NPVs of 3 scenarios for a timing option: E(NPV) probability $0.15 0.30 $10.35 0.50 $42 0.20 1. What is the expected NPV of the timing option? Show your work. 2. Suppose, that the expected NPV of the project if proceeding today is $14. Should the project be delayed based on your finding in part 1 or should the management implement it today? Briefly explain.
3e.a.Determinethe payback period for each b.Calculatethe net present value (NPV) for each c.Calculatethe profitability index (PI) for each project. d.Calculatethe internal rate of return (IRR) for each e.Basedon ALL your answers above, explain briefly which project should be Note: i just need (e) no question answer not all no need excle formula , thank you
Whispering Winds Company is considering a long-term investment project called ZIP. ZIP will require an investment of $130,000. It will have a useful life of four years and no salvage value. Annual cash inflows would increase by $81,000, and annual cash outflows would increase by $40,500. In addition, the company's required rate of return is 10% Click here to view the factor table (a) Calculate the net present value on this project. (If the answer is negative, use either a negative sign preceding the number eg-5,275 or parentheses es. (5,275), For calculation purposes, use 5 decimal places as displayed in the factor table provided, eg. 1.25124 and final answer to O decimal places, eg. 5,275) Net present value $ Identify whether the project should be accepted or rejected. The project should be (b) Q Search 458 PM
A2. (PaybackandNPV)Threeprojectshavethecashflowsgivenhere.Thecostofcapitalis10%. a. Calculate the paybacks for all three projects. Rank the projects from best to worst based on their paybacks. Calculate the NPVs for all three projects. Rank the projects from best to worst based on their NPVs c. Why are these two sets of rankings different? YEAR 0 1 2 3 4 5Project 1 −10 4 3 2 1 5 Project 2 −10 1 2 3 4 5 Project 3 −10 4 3 2 1 10
Determine the feasibility of below presented project using FW Method. Use MARR = 10% Note: Round off your answer to the NEAREST WHOLE NUMBER and show complete solution Answer the following: FW of Alt. A is $Blank 1 FW of Alt. B is $Blank 2 FW of Alt. C is $Blank 3 FW of Alt. D is $Blank 4 Select Alternative (Write only the letter if A,B,C or D) Blank 5
In calculating IRR for a project, you determine that you must find i* that satisfies (A/P, i, 6) = 0.200. The Compound Interest Tables show that (A/P, 5%, 6) = 0.19702 and (A/P, 6%, 6) = 0.20336. Using Linear Interpolation, what is i*?

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