Given four proposals for funding a new project with a 100M limit on capital funding and the MARR is established at 12% per year. Project Life, Years Project First Cost Estimated Annual Savings W 12M 5M 3 25M 7.3М 4 Y 45M 12.1M 6 60M 9M Use the exact internal rate of return method to determine which of the four independent projects should be funded. Write the value of the acceptable project accordingly/in sequence (W/X/Y/Z). ANSWER for ALTERNATIVE 1: Blank 1 ANSWER for ALTERNATIVE 2: Blank 2 Blank 1 Add your answer Blank 2 Add your answer

Given four proposals for funding a new project with a 100M limit on capital funding and the MARR is established at 12% per year. Project Life, Years Project First Cost Estimated Annual Savings W 12M 5M 3 25M 7.3М 4 Y 45M 12.1M 6 60M 9M Use the exact internal rate of return method to determine which of the four independent projects should be funded. Write the value of the acceptable project accordingly/in sequence (W/X/Y/Z). ANSWER for ALTERNATIVE 1: Blank 1 ANSWER for ALTERNATIVE 2: Blank 2 Blank 1 Add your answer Blank 2 Add your answer

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 11MC: In an unrelated analysis, you have the opportunity to choose between the following two mutually...

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In an unrelated analysis, you have the opportunity to choose between the following two mutually exclusive projects, Project T (which lasts for 2 years) and Project F (which lasts for 4 years): The projects provide a necessary service, so whichever one is selected is expected to be repeated into the foreseeable future. Both projects have a 10% cost of capital. (1) What is each projects initial NPV without replication? (2) What is each projects equivalent annual annuity? (3) Apply the replacement chain approach to determine the projects extended NPVs. Which project should be chosen? (4) Assume that the cost to replicate Project T in 2 years will increase to 105,000 due to inflation. How should the analysis be handled now, and which project should be chosen?
Given four proposals for funding a new project with a 100M limit on capital funding and the MARR is established at 12% per year. Project First Cost Estimated Annual Savings Project Life, Years 12M 5M 3 25M 7.3M 4 Y 45M 12.1M 60M 9M 8. Use the exact internal rate of return method to determine which of the four independent projects should be funded. Write the value of the not acceptable project accordingly/in sequence (W/X/Y/Z). ANSWER for ALTERNATIVE 1: Blank 1 ANSWER for ALTERNATIVE 2: Blank 2
a) Calculate the payback period for each project. The maximum allowable payback period setby the company for all projects is 3 years. b) Calculate the net present value (NPV) for each project c) Calculate the profitability index (PI) for each project d) Calculate the internal rate of return (IRR) for each project. e) Based on the answer in (a) – (d), explain briefly which project should be accepted. f) If the project is independent project, how would your answer change in part (e) Note: I need only e,f no question answer. only e and f
a) Calculate the payback period for each project. The maximum allowable payback period setby the company for all projects is 3 years. b) Calculate the net present value (NPV) for each project c) Calculate the profitability index (PI) for each project d) Calculate the internal rate of return (IRR) for each project. e) Based on the answer in (a) – (d), explain briefly which project should be accepted. f) If the project is independent project, how would your answer change in part (e) Note: 1. I need only e,f no question answer. only e and f  2. No need excel formula
Compute NPV and IRR if the required return is 12 percent. Year                                        CashFlow      0                                                     -8,000      1                                       0      2                                                     5,500      3                                                     3,200 What is the “cross-over” rate of the following projects? Year                                                                Project A                     Project B      0                                                     -1,400                        -800      1                                                         950        600      2                                                         950            600 Sketch the NPV profile of the following project and show the multiple IRRs. Note that the project has two IRRs and the first one is at 25 percent. Year                            CashFlow…
NEED HELP ASAP!! THANK YOU!! Given four proposals for funding a new project with a 100M limit on capital funding and the MARR is established at 12% per year. Project    First Cost          Estimated Annual Savings        Project Life, Years    W 12M                             5M 3    X 25M 7.3M 4    Y 45M                             12.1M 6    Z 60M                              9M 8 Use the exact internal rate of return method to determine which of the four independent projects should be funded. Write the value of the acceptable project accordingly/in sequence (W/X/Y/Z). ANSWER for ALTERNATIVE 1: Blank 1 ANSWER for ALTERNATIVE 2: Blank 2
*** By using the following table format, calculate: (a) Calculate the, the Payback Period, and the net Present Value of for each project. Calculation of Payback Period for each project: CUMULATIVE CASH FLOWS Project A Project B Project C £ £ £ Year 1 Year 2 Year 3 Year 4 Year 5 Payback Period (years and months) Calculation of Net Present Value for each project: Discount Factors Project A Project B Project C CF DCF CF DCF CF DCF £ £ £ £ £ £ Year 1 Year 2 Year 3 Year 4 Year 5 Total DCF Initial investment Net present value b) For each of the above methods of project appraisal recommend which project should be taken up. c) Using all the information gathered from the above techniques which…
Compute the payback statistic for Project A if the appropriate cost of capital is 8 percent and the maximum allowable payback period is four years. (Round your answer to 2 decimal places.) Project A Time: 0 1 2 3 4 5 Cash flow: −$1,300 $470 $570 $580 $360 $160 Payback: In years? Should the project be accepted or rejected?multiple choice accepted rejected
Consider the following project balances for a typical investment project with aservice life of four years: (a) Construct the original cash flows of the project.(b) Determine the interest rate used in computing the project balance.(c) Would this project be acceptable at a MARR of 12%?
a) Use rate of return (ROR) analysis to determine which of the mutually exclusive projects listed below to select given a MARR of 12% per year. b) Confirm your answer to part (a) using Present Worth analysis.
Alternatives A, B associated with a project have data as in the following figure, MARR=12% /year, Study period is 6 years. Find: Which alternatives should be selected? A B Capital investment $2800 $5000 Annual cash flow 1100 1400 Useful life (years) 3 6 Market value at end of useful life 0 0
Payback period. Given the cash flow of two projects-A and B-in the following table, and using the payback period decision model, which project(s) do you accept and which proje period for recapturing the initial cash outflow? For payback period calp What is the payback period for project A? 6 Data Table - X years (Round to one decimal place.) (Click on the following icon D in order to copy its contents into a spreadsheet.) Cash Flow B. Cost Cash flow year 1 Cash flow year 2 Cash flow year 3 Cash flow year 4 Cash flow year 5 Cash flow $12,000 $6,000 $6,000 $6,000 $100,000 $20,000 $10,000 $40,000 $6,000 $30,000 SO $6,000 $6,000 year 6. SO Print Done