b) For a project that has a net investment of $150,000 and net cash flows of $40,000 for 5 years; Is the internal rate of return between (9% and 10%) or (10% and 11%). Explain your answer. c) A project has an expected NPV of $50,000 with a standard deviation of the NPV of $20,000. ASsume that NPV is normally distributed. What is the probability that the project will have a net present value greater than $60,000?
b) For a project that has a net investment of $150,000 and net cash flows of $40,000 for 5 years; Is the internal rate of return between (9% and 10%) or (10% and 11%). Explain your answer. c) A project has an expected NPV of $50,000 with a standard deviation of the NPV of $20,000. ASsume that NPV is normally distributed. What is the probability that the project will have a net present value greater than $60,000?
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
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Question
Transcribed Image Text:b) For a project that has a net investment of $150,000 and net cash flows of $40,000
for 5 years; Is the internal rate of return between (9% and 10%) or (10% and
11%). Explain your answer.
c) A project has an expected NPV of $50,000 with a standard deviation of the NPV
of $20,000. Assume that NPV is normally distributed.
What is the probability that the project will have a net present value greater than
$60,000?
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