please ASAP, direct thumps up :) Consider the two mutually exclusive projects.AВ-12,0004000-10,00018000X38000XWhat is the value of X that would make the two economically equivalent at the interest rate 14%?6998.36123.45627.36817.2

Firstly calculate the present value of project A

Consider the two mutually exclusive projects. n A B -12,000 -10,000 1 4000 8000 X 8000 X What is the value of X that would make the two economically equivalent at the interest rate 14%? 6998.3 6123.4 5627.3 6817.2

Consider the two mutually exclusive projects. n A B -12,000 -10,000 1 4000 8000 X 8000 X What is the value of X that would make the two economically equivalent at the interest rate 14%? 6998.3 6123.4 5627.3 6817.2

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

See similar textbooks

Related questions

Q: Investment Perlod 1 A - $4,000 $11,000 B -20,000 33,000

A: Profitability index = Present value of cash inflow / Initial investment Investment with higher…

Q: alculate the NPV of project X

A: It refers to the long term investment decisions that has been taken by the top management of a…

Q: Consider the following two projects: cash flows Project A Project B c0…

A: Hi. As per the guidelines we are allowed to answer the first four parts of a sub-part question.…

Q: Here are the cash flows for a project under consideration: C0 C1 C2 −$7,510 +$5,420…

A: a) Computation of NPV is as follows: Hence, the NPV is $17110. Working note:

Q: Consider the following two mutually exclusive projects: Cash Flow (B) Cash Flow (A) $-300,000 20,000…

A: Net present value (NPV) is the difference between the present value of cash inflows and the present…

Q: #14 NPV verse IRR Here is the cash flow for two mutually exclusive projects. Project C0…

A: An incremental cash flow is calculated first followed by the IRR of that cash flow. At an interest…

Q: Here is the cash flow for two mutually exclusive projects. Project C0…

A: The computation of the interest rate as follows: The formula used for the computation of the above…

Q: (Mutually exclusive projects and NPV) You have been assigned the task of evaluating two mutually…

A: The cash inflows given for project A are same in the amount. So, annuity formula can be used to…

Q: 6.36 The four alternatives described below question has three parts Part 3: If the proposals are…

A: The answer is as fallows

Q: NPV Your division is considering two projects with the following cash flows (in millions):…

A: Given information : Year Project A Project B 0 $ -25.00 $ -20.00 1 $ 5.00 $…

Q: What is the crossover rate for these two projects? Crossover rate 11.86 % What is the NPV of…

A: Calculation of cross over rate for two projects: Excel spreadsheet:

Q: Consider the borrowing rates for Parties A and B. A wants to finance a $100,000,000 project at a…

A: Swap: It is an agreement where principal amount of a loan and the interest in one currency for the…

Q: Whichever project Consider the following mutually exclusive project below. chosen, a 15 percent…

A: NPV is the present value of future cash flows. It is a tool which is used to decide whether the…

Q: What is the dollar-denominated net present value (NPV) of this project? $792,199 $861,086 $688,869…

A: Information Provided: Investment = $800,000 Cashflows = $900,000 Current exchange rate = $0.7877 per…

Q: Q8 - Consider the following two mutually exclusive projects: Year Cash Flow (X) Cash…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$…

A: Capital budgeting is an investment appraisal technique that helps to evaluate a capital project's…

Q: What is the equation for the bolded item?

A: The PVIFA calculation formula is as follows: PVIFA=1-(1+r)-nr =1-(1+10.20%)-910.20% PVIFA=present…

Q: 1. A firm is considering three mutually exclusive expansion projects. Their initial cost is the same…

A: To Find: NPV IRR Payback period

Q: If the firm ha limit of $150 million to invest, what is the maximum NPV the company can obtain (A).…

A: The projects will be chosen which have higher relative NPV and lower initial cost. Project A is…

Q: Your division is considering two projects. The discount rate is 10 percent, and the projects’ after-…

A: “Hey, since you have posted a question with multiple sub-parts, we will answer first three sub parts…

Q: Consider an investment project: Find: Equivalent Future F15 over 15 years using Gradient Payments…

A: The future value of a present value is the value of that amount after taking into account the time…

Q: Consider the following two mutually exclusive projects: Year Cash Flow Cash Flow…

A: Please find the answers to the above questions below:

Q: Which of the following projects has the larger Equivalent Annual Net Benefit if the interest rate is…

A: EQUIVALENT ANNUAL NET BENEFIT (EANB) is the amount received each year for the life of project which…

Q: Problem 2. Compare the following mutually exclusive alternatives using the conventional incremental…

A: B/C ratio refers to the Benefit to Cost ratio. B/C ratio is a comparative analysis ratio which…

Q: Present

A: Formula to calculate PV: PV = FV/(1+i)^n Where PV is the present value FV is the future value i is…

Q: Consider the following two mutually exclusive projects: What value of X would make the decision…

A: Time value of money (TVM) is a concept which states that the money today has more worth than the…

Q: Given the following cash +pws for project X and project Y, Year Project X Project Y -62000 -105000 1…

A: GIVEN, year X Y 0 -62000 -105000 1 27000 10000 2 13500 18000 3 11000 22000 4 10000…

Q: 1. The Bolster Company is considering two mutually exclusive projects: Year Cash Flow A Cash Flow B…

A: given, year A B 0 -100000 -100000 1 31250 0 2 31250 0 3 31250 0 4 31250 0 5 31250…

Q: Compute the equivalent future value of a series of yearly payments of P 8,000 if the sinking factor…

A: Future value is the amount collected from the accumulation of the money from deposit and interest…

Q: Consider the following projects, X and Y where the firm can only choose one. Project X costs $1500…

A: NPV means present value of net profit generate from operations. It is calculated by simply…

Q: Consider the following two mutually exclusive projects: Year Cash Flow(A) -$ 63,000 39,000 33,000…

A: Since you have posted a question with multiple sub-parts, we will solve first four subparts for…

Q: Compute the (a) net present value, (b) internal rate of return (IRR), and (c) discounted payback…

A: Excel Spreadsheet:

Q: Central Energy is considering two mutually exclusive projects, Project Red and Project The projects…

A: Year Project Red cash flow Project White cash flow 0 -1000 -1000 1 100 700 2 200 400 3 600…

Q: Consider the three mutually exclusive projects that follow. The firm’s MARRis 10% per year. Solve,…

A: We will only answer the first three subparts, For the reamining subparts, kindly resubmit the…

Q: Q10 Two major investment projects have the same initial outlay of €1,000 milion. The expected net…

A: Given: Project A Project B Year Particulars Cash flows Cash flows 0 Initial investment -€…

Q: Consider the following two mutually exclusive alternatives: (a) Determine the IRR on the incremental…

A: IRR is a parameter which is used in financial analysis to measure the feasibility of potential…

Q: considering two mutually exclusive projects, Project Red and Project The projects have the…

A: To find the weighted average cost of capital at which both the projects would have the same net…

Question

100%

please ASAP, direct thumps up :)

Consider the two mutually exclusive projects.
A
В
-12,000
4000
-10,000
1
8000
X
3
8000
X
What is the value of X that would make the two economically equivalent at the interest rate 14%?
6998.3
6123.4
5627.3
6817.2

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Step by step

Solved in 4 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Consider the following teo mutually exclusive projects X 20600, 9000 9400 8950 Y 20600 10400 7950 8850 calculate the irr for each project, what is the crossover rate, what is the npv of the projects x and y with a discount rate of 0, 15, and 25%
NPV versus IRR [LO1, 5] Consider the following two mutually exclusive projects: Year Cash Flow (X) Cash Flow (Y) O -$30,000 -$30,000 1 13,700 15,600 2 14,200 12,200 3 13,400 13,300 Page 313 Sketch the NPV profiles for X and Y over a range of discount rates from zero to 25 percent. What is the crossover rate for these two projects?
1) You are considering the following mutually exclusive projects: (15pts) 1 4. Project A -400 50 50 50 230 230 Project B -600 300 300 50 50 50 if the firm required return (WACC) is 10%: a. What is the NPV of project A? b. What is the IRR of project A? C. What is the NPV of project B? d. What is the IRR of project B? e. Which one you must select? a. b. C. d. e.
5.6 Nimby plc is considering two mutually exclusive projects: Delphi and Oracle. The possible NPVS for each project and their associated probabilities are as follows: Delphi Oracle NPV Probability of occurrence NPV Probability of occurrence £m £m 20 0.2 30 0.5 40 0.6 40 0.3 60 0.2 65 0.2 Required: (a) Calculate the expected net present value and the standard deviation associated with each project. (b) Which project would you select and why? State any assumptions you have made in coming to your conclusions. (c) Discuss the limitations of the standard deviation as a measure of project risk.
[CLO-5] Determine the value of X for these two investment alternatives to be equivalent at an interest rate of i= 15% per year O 499.77 O 502.25 1,700 2X 1,000 O 501.78 O 489.77 1,000 pill! T 10 15 10 End of Year End of Year 5,000
Calculate the interest rate for the following present value, time and future value:PV=38,261; t=50; FV= 531,618a) 10.50b) 7.36c) 5.40d) 13.87
Suppose S(NZD/USD) = 1.5000 and S(MYR/USD) = 4.4000. What is the cross rate S(MYR/NZD)? Choose the closest answer to your own calculations. a. 2.9333 b. 0.3409 c. 6.6000 d. 0.1515
Q9. Find the NPV, payback period and profit index for both projects, if the discountrate is 11%: Year Project A Project B -200 -200 1 80 100 2 80 100 80 100 80 Which mutually exclu sive project would you select and why?
Suppose that we can describe the world using two states and that two assets are available, asset K an asset L. We assume the asset’s future prices have the following distribution State Future Price Asset K Future Price Asset L 1 $55 $60 2 $45 $30 The current price of asset K is $50, and the current price of asset L is $50. What is the risk free rate implied by these assets?
Suppose you are offered a project with the following payments: Year Cash Flows 0 $ 9,800 1 −5,300 2 −4,000 3 −3,100 4 −1,700 a. What is the IRR of this offer? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. If the appropriate discount rate is 15 percent, should you accept this offer? c. If the appropriate discount rate is 21 percent, should you accept this offer? d-1. What is the NPV of the offer if the appropriate discount rate is 15 percent? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. d-2. What is the NPV of the offer if the appropriate discount rate is 21 percent? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
8. Consider countries X and Y with risk-free rates of 8 and 10 percent, respectively. The future price (Currency X/ Currency Y) for a contract deliverable in 3 months is the same as the current exchange rate. Is there any arbitrage opportunity? If there is, design a strategy to exploit the arbitrage
9.36 The fouT mutuzlly exclusive alternatives below are being compared using the B/C method. What altemative, if any, should be selected? Initial Investment, Incremental B/C When Compared With Altemative Altemative S Millions BC Ratio K L 20 0.40 --- 25 33 0.96 122 K 1.42 2.14 --- 0.72 0.80 0.08-- 45 0.39 I. Activate Winde PC settings to DFocus SAN FRACISCO.CA

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS