Best Industries is considering an investment project that has the following cash flows: Year 0…………… $ -1,200 Year 1………………. 200 Year 2……………….. 200 Year 3……………….. 800 Year 4………………… 300 The company’s discount rate for such calculations is 10% 1. For Best Industries what is the project’s IRR? a. 10.00% b. 11.92% c. 22.75% d. 8.40% 2. For Best Industries what is the NPV? a. $153 b. $ -46.94 c. $375.44 d. $ -153.06 3. Internal rate of return is also: a. Yield b. Rate of return c. Discount rate that makes the NPV equal to zero d. All of the above

Best Industries is considering an investment project that has the following cash flows: Year 0…………… $ -1,200 Year 1………………. 200 Year 2……………….. 200 Year 3……………….. 800 Year 4………………… 300 The company’s discount rate for such calculations is 10% 1. For Best Industries what is the project’s IRR? a. 10.00% b. 11.92% c. 22.75% d. 8.40% 2. For Best Industries what is the NPV? a. $153 b. $ -46.94 c. $375.44 d. $ -153.06 3. Internal rate of return is also: a. Yield b. Rate of return c. Discount rate that makes the NPV equal to zero d. All of the above

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 23E: Assume that an investment of 100,000 produces a net cash flow of 60,000 per year for two years. The...

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