Castle Company is considering an investment opportunity with the following expected net cash inflows: Year 1, $225,000; Year 2, $165,000; Year 3, $120,000. The company uses a discount rate of 9% and the initial investment is $325,000. (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Calculate the NPV of the investment. Should the company invest in the project? Why or why not? Use the following table to calculate the net present value of the project. (Enter any factor amounts to three decimal places, X.XXX.) Net Cash PV Factor (i Inflow -9%) Present Value Years Year 1 Present value of each year's inflow:(n-1) Year 2 Present value of each year's inflow: (n - 2) Year 3 Present value of each year's inflow: (n-3) Total PV of cash inflows Year 0 Initial investment Net present value of the project Reference Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 Period 11 Period 12 Period 13 Present Value of Ordinary Annuity of $1 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 14% 15% 16% 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 0917 0.909 0.893 0.877 0.870 0.862 0 1.970 1.942 1.913 1.885 1.859 1.833 1.808 1.783 1.759 1.736 1.690 1.647 1.626 1.605 1 2941 2.884 2.829 2.775 2.723 2.673 2624 2.577 2531 2487 2402 2.322 2.283 2246 2 3.902 3.808 3.717 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.037 2914 2.855 2.798 2 4.853 4.713 4.580 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.605 3.433 3.352 3.274 3 5.795 5.601 5.417 5.242 5.076 4.917 4.767 4.623 4.486 4.355 4.111 3.889 3.784 3.685 3 6.728 6.472 6.230 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.564 4.288 4.160 4.039 3 7.652 7.325 7.020 6.733 6.463 6.210 5.971 5.747 5.535 5.335 4.968 4.639 4.487 4.344 4 8.566 8.162 7.786 7.435 7.108 6.802 6.515 6.247 5.995 5.759 5.328 4.946 4.772 4.607 4 9.471 8.983 8.530 8.111 7.722 7.360 7.024 6.710 6418 6.145 5.650 5.216 5.019 4.833 4 10.368 9.787 9.253 8.760 8.306 7.887 7.499 7.139 6.805 6.495 5.938 5.453 5.234 5.029 4 11.255 10.575 9.954 9.385 8.863 8.384 7.943 7.536 7.161 6814 6.194 5.660 5.421 5.197 4 2 134 11 348 10 635 9988 9.394 8853 8 358 7.904 7487 7103 7487 7.103 6424 5842 5593 5342 A

Perez Company is considering an investment of $26,945 that provides net cash flows of $8,500 annually for four years.(a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.)(b) The hurdle rate is 7%. Should the company invest in this project on the basis of internal rate of return?

Compute the profitability index for the following proposal, assuming the desired minimum rate of return is 12%. Use the present value factors with six decimal places at the end of your Chapter 25 notes; don’t use the tables in your textbook. Round all intermediate calculations to TWO decimal places; also round your final answer to TWO decimal places. (See your Chapter 25 notes, pages 9 & 14) Initial cash outlay................................. $16,000 Net cash inflow (after taxes): Year 1................................................. $10,000 Year 2.................................................. $9,000 Year 3.................................................. $6,000 Year 4......................................................... $0 Total net inflows.................................. $25,000

Compute the payback period for this investment. (Cumulative net cash outflows must be entered with a minus sign. Round your Payback Period answer to 2 decimal place.)

(Related to Checkpoint 6.6) (Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: € 12 X End of Year 1 2 S 3 4 5 6 7 8 7 N example # 3 a. What is the present value of investment A at an annual discount rate of 25 percent? $(Round to the nearest cent.) E D A $12,000 12,000 12,000 12,000 12,000 30 F3 Get more help. C $ 4 Investment Alternatives DOD 888 F4 R F V de s % B 5 $12,000 12,000 12,000 12,000 F5 T G 6 B C $12,000 60,000 MacBook Air F6 Y H & 7 N 44 U J 8 PII Fa 1 M - a K MOSISO DD F9 O < مه 26 -0 L command F10 P . V : ; Clear all 4 FU { I option [ +11 = ? 1 " I Final check 419) F12 } 1 delete retu

You are evaluating five different investments, all of which involve an upfront outlay of cash. Each investment will provide a single cash payment back to you in the future. Details of each investment appears here: Calculate the IRR of each investment. State your answer to the nearest basis point (i.e., the nearest 1/100th of 1%, such as 3.76%). The yield for investment A is The yield for investment B is The yield for investment C is The yield for investment D is The yield for investment E is %. (Round to two decimal places.) %. (Round to two decimal places.) %. (Round to two decimal places.) %. (Round to two decimal places.) %. (Round to two decimal places.) C Data table Investment A B с D E Initial Investment $1,600 $10,000 $600 $3,400 $5,200 Future Value Print $3,120 $15,775 $2,923 $4,526 $8,789 End of Year 10 11 16 Done 3 (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) 12 D X

Dalvi Incorporated is considering a new Investment. The table below lists the cash flows. Year Cash Flows -$19600 1 $6,600 2 $5,600 3 $7,400 Calculate the Payback period Calculate the NPV and IRR. Assume that the interest rate is 0%.

For the cash flow shown below. Find the external rate of return (EROR) using the modified rate of return approach (MIRR), an investment rate of 15% per year, and a borrowing rate of 8% per year. Year 3 4 NCF,$ -9000 +4100 -2000 -7000 +12000 +700 +800 Select one: O a. 7.9% Ob.9.9% O c. 5.9% O d. 11.9%

An investment has an installed cost of $527,630. The cash flows over the four-year life of the investment are projected to be $212,200, $243,800, $203,500 and $167,410, respectively. If the discount rate is 10%, at what discount rate is the NPV just equal to 0? (Input in percentage, keep 2 decimals. e.g. if you got 0.10231, input 10.23) Question 10 The Yurdone Corporation wants to set up a private cemetery business. According to the CFO, Barry M. Deep, business is "looking up". As a result, the cemetery project will provide a net cash inflow of $145,000 for the firm during the first year, and the cash flows are projected to grow at a rate of 4% per year forever. The project requires an initial investment of $1,900,000. The company is somewhat unsure about the assumption of a growth rate of 4% in its cash flows. At what constant growth rate would the company just break even if it still required a return of 11% on investment? (Input in percentage, keep 2 decimals. e.g. if you got…

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