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Author Question: Babcock Inc. is considering a project that has the following cash flow and WACC data. What is the ... (Read 62 times)

jordangardner

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on: Aug 7, 2023

Question 1

Aubey Inc. is considering two projects that have the following cash flows:

​

​

​

Project 1

Project 2

Year

Cash Flow

Cash Flow

0

–$2,300

–$2,100

1

600

1,300

2

800

1,200

3

1,100

900

4

1,200

700

5

1,400

600

​

​

At what cost of capital would the two projects have the same NPV?


◦

2.73%


◦

3.85%


◦

4.51%


◦

5.50%



Question 2

Babcock Inc. is considering a project that has the following cash flow and WACC data. What is the project’s NPV?

WACC:11%   
Year:

0

1

2

3

Cash flows:

–$950

$600

$400

$200


◦

$31.43


◦

$37.49


◦

$40.52


◦

$43.54

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by jordangardner on Aug 7, 2023

dianagarcia

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Reply #1 on: Aug 7, 2023
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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jordangardner

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Reply 2 on: Aug 7, 2023
YES! Correct, THANKS for helping me on my review

zacnyjessica

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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