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Author Question: What is the NPV of the Boeing 787 Dreamliner project? The Boeing 787-8 can carry 230 passengers up ... (Read 78 times)

stevenposner

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on: Apr 25, 2021
What is the NPV of the Boeing 787 Dreamliner project? The Boeing 787-8 can carry 230 passengers up to 8,200 nautical miles at a cruising speed of mach 0.85. The Dreamliner is more comfortable for passengers because of higher cabin humidity. Boeing completed construction on its final assembly plant at time t = 0 for a total cost of $7B. Boeing has secured orders for 865 aircraft over the next five years (t = 1 to t = 5) for total proceeds of $138.4B ($160M per aircraft). The cost of building each plane is $140M. Assume that cash flows (sales and costs) occur at the end of each year starting one year after the assembly plant was completed. The project cash flows are shown in the table, below. What is the NPV of the project if Boeing's cost of capital is 10%? Calculate the NPV as of time t=0. (Round answer to the nearest million).

YearCapital InvestmentAnnual SalesAnnual RevenuesAnnual CostsCash Flows
t = 0$7,000M​​​-7,000
t = 1​17327,68024,2203,460
t = 2​17327,68024,2203,460
t = 3​17327,68024,2203,460
t = 4​17327,68024,2203,460
t = 5​17327,68024,2203,460

◦ $6,116M
◦ $8,069M
◦ $8,780M
◦ $8,967M
◦ $13,116M
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Marked as best answer by stevenposner on Apr 25, 2021

jessicaduplan

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Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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stevenposner

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Reply 2 on: Apr 25, 2021
Great answer, keep it coming :)

Sarahjh

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Reply 3 on: Yesterday
Excellent

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