The net present value of a capital project varies with the discount rate as follows: Discount Rate 0% 12 20 ៖ NPV $145,600 50,000 0 - 200,000 Sketch the NPV profile of the project. Label each axis and note the location of the internal rate of return.

Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter11: Cash Flow Estimation And Risk Analysis
Section: Chapter Questions
Problem 7MC: Calculate the project cash flows for each year. Based on these cash flows and the average project...
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The net present value of a capital project varies
with the discount rate as follows:
Discount Rate
0%
12
20
8
NPV
$145,600
50,000
0
- 200,000
Sketch the NPV profile of the project. Label each
axis and note the location of the internal rate of
return.
Transcribed Image Text:The net present value of a capital project varies with the discount rate as follows: Discount Rate 0% 12 20 8 NPV $145,600 50,000 0 - 200,000 Sketch the NPV profile of the project. Label each axis and note the location of the internal rate of return.
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