NPV, IRR, MIRR, Profitability Index, Payback, Discounted Payback,
Not what you're looking for?
(10-1)
NPV
A project has an initial cost of $40,000, expected net cash inflows of $9,000 per year for 7 years, and a cost of capital of 11%. What is the project's NPV (Hint: Begin by constructing a time line.)
(10-2)
IRR
Refer to Problem 10-1. What is the Project's IRR?
(10-3)
MIRR
Refer to Problem 10-1 What is the project's MIRR?
(10-4)
Profitability Index
Refer to Problem 10-1. What is the project's PI?
(10-5)
Payback
Refer to Problem 10-1. What is the project's payback period?
(10-6)
Discounted Payback
Refer to Problem 10-1. What is the project's discounted payback period?
(10-7)
NPV
Your division is considering two investment projects, each of which requires an up-front expenditure of $15 million. You estimate that the investments will produce the following net cash flows:
Year Project A Project B
1 $5,000,000 $20,000,000
2 10,000,000 10,000,000
3 20,000,000 6,000,000
a. What are the two projects' net present values, assuming the cost of capital is 5%? 10%? 15%?
b. What are the two projects' IRRs at these same costs of capital?
Purchase this Solution
Solution Summary
Solution helps in estimating NPV, IRR, MIRR, Profitability Index, Payback, Discounted Payback,
Purchase this Solution
Free BrainMass Quizzes
Writing Business Plans
This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.
Accounting: Statement of Cash flows
This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.
Basic Social Media Concepts
The quiz will test your knowledge on basic social media concepts.
Managing the Older Worker
This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce
Lean your Process
This quiz will help you understand the basic concepts of Lean.