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# Finance:net present value,irr and depreciation.

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1. You are considering the following two mutually exclusive projects that will not be repeated. The required rate of return is 11.25% for project A and 10.75% for project B. Which project should you accept and why?

project A; because its NPV is about \$335 more than the NPV of project B
project A; because it has the higher required rate of return
project B; because it has the largest total cash inflow
project B; because it returns all its cash flows within two years
project B; because it is the largest sized project

2. What is the internal rate of return on an investment with the following cash flows?

5.93%
5.96%
6.04%
6.09%
6.13%

3. LiCheng's Enterprises just purchased some fixed assets that are classified as 3-year property for MACRS. The assets cost \$1,900. What is the amount of the depreciation expense for year 2?
\$562.93
\$633.27
\$719.67
\$844.36
\$1,477.63

#### Solution Summary

The problem set decks with problems in finance:net present value,internal rate of return,depreciation etc.

\$2.19