Q1:Compare the alternatives below using future worth analysis at i = 8% %3D per year using LCM. P First cost, $ Annual operating cost, $ per year Salvage value, $ Life, years - 23,000 - 30,000 - 2,500 - 4,000 3,000 1,000 3

D-78 Which of the following equations can be used to find the internal rate of return (i) for a project that hun initial investment of P, net annual cash flows of A, and salvage value of S after n years? (a) 0 = -P + AP/A, i%,n) + SP/A, i%, n) | (b) (Р — А)P/А, 1%, п) — SPIF, 1%, n) (с) — А %3D — РАР, %, п) — S(AF, i1%, п — 1) (d) 0 = -PF/P, i%,n) + A(F/A, i%, n) + S

solution in excel

Fix=sum(D3:D9) Based on the risk of each project, the company has a required rate of return of 11%. -800,000, 220,000, 265,000, 292,000, 317,000

Project A has the following estimated cash flows and present values:Year                        Cash flow $       Discount factor@ 12%       Present value $0   Cost                    (95 000)          1.0                                         (95 000) 1–5 Contributionper annum               50 000             3.605                                    180 250 1–5 Fixed costsper annum               (25 000)           3.605                                    (90 125) 5 Residual value       20 000             0.567                                    11 340   The benefit of using sensitivity analysis in an investment appraisal would be:

What is the MIRR for the project using a 12% Cost of Capital? Show in a timeline format. Year Cash Flow in $ 0 ($1000) 1 400 2 400 3 600

Profitability Index A project has an initial cost of $65,000, expected net cash inflows of $14,000 per year for 9 years, and a cost of capital of 11%. What is the project's PI? (Hint: Begin by constructing a time line.) Do not round intermediate calculations. Round your answer to two decimal places.