An investment requires an outflow of $300,000 at time zero and another outflow of $60,000 at the end of the first year. Net after-tax inflows for years 2, 3 and 4 are zero. After tax inflows in years 5, 6 and 7 are $60,000, $400,000 and $400,000, respectively. The required rate of return is 17%. What is the Net Present Value of the investment?

Rupert Real Estate Company is planning to invest in a new development. The cost of the project will be $24 million and is expected to generate cash flows of $15,000,000, $12,850,000, and $5,450,000 over the next three years. The company's cost of capital is 20 percent. What is the internal rate of return on this project?

Munich Corp is looking to add a new machine at a cost of $5,133,250. The company expects this equipment will lead to cash flows of $918,822, $963,275, $947,250, $2,017,110, $2,212,960, and $2,225,000 over the next six years. If the appropriate discount rate is 15 percent, what is the NPV of this investment?

Given the following cash flows for a capital project, calculate the IRR.
Year
0 1 2 3 4 5
Cash Flows ($60,468) $13,749 $13,425 $21,549 $9,580 $5,958

Solution Summary

The solution depicts the steps to calculate NPV and IRR values in the given cases with step-by-step calculations and all formulas shown.

... Solution describes the steps to calculate NPV and IRR of given investment proposal ... up a worksheet that will tell you both the net present value of this ...

... For each of the projects shown in the following table, calculate the internal ... by dis f capital is given, NPV can be calculated by discounting ...NPV Calculator. ...

Finance: Calculate IRR, NPV, Cost of Capital. ... The firm has two possible investments with the following ... s) should the firm make according to net present value? ...

... an Annuity It can be read from tables or calculated using the ... For calculating IRR we will find NPV at two rates and ... d. Calculate the accounting rate of return. ...

... For calculating IRR use IRR function in Excel IRR= 9.61% IRR is greater than cost of capital ie 8%, Project can be ... For NPV criteria calculate PV of ...

...Calculate the NPV if the cost of capital is 8%. Should you take the investment? Calculate the IRR and use it to determine the maximum deviation allowable in ...

... c) Calculate the NPV on this investment? Should Willie go for it? ... The expert calculates the after tax cash, NPV and IRR for a Windmill New Machine. ...

Calculate payback period, discount rate, NPV, IRR for 3 ... If the discount rate for all three projects is 10.5%, What is the Net Present Value for each ...

... Solution describes the steps in calculating NPV of cash flows ... for making capital budgeting decisions - IRR or NPV? ... We will calculate Present Value of Each Cash ...