This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Last month, Smith Systems Inc. decided to accept the project whose cash flows are shown below. ... (Read 42 times)

madimontg

  • Full Member
  • ***
  • Posts: 127
on: Aug 7, 2023

Question 1

Johnson Enterprises 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

4

Cash flows:

–$1,000

$390

$390

$390

$390


◦

$193.78


◦

$197.98


◦

$201.45


◦

$209.95



Question 2

Last month, Smith Systems Inc. decided to accept the project whose cash flows are shown below. However, before actually starting the project, the Bank of Canada took actions that lowered interest rates and therefore Smith’s WACC. By how much did the change in the WACC affect the project’s forecasted NPV? Assume that the Bank of Canada’s action does not affect the cash flows.

​

​

New WACC:  9%     Old WACC:12%

Year:              0              1                  2                     3

Cash flows:    –$1,200   $600            $600               $600


​


◦

$72.18


◦

$75.19


◦

$77.68


◦

$79.69

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
Buy Test-Bank


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by madimontg on Aug 7, 2023

aublw

  • Full Member
  • ***
  • Posts: 168
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.
Answer Preview
Only 44% of students answer this correctly


madimontg

  • Member
  • Posts: 127
Reply 2 on: Aug 7, 2023
Gracias!

ecabral0

  • Member
  • Posts: 310
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

The modern decimal position system was the invention of the Hindus (around 800 AD), involving the placing of numerals to indicate their value (units, tens, hundreds, and so on).

Did you know?

Egg cells are about the size of a grain of sand. They are formed inside of a female's ovaries before she is even born.

Did you know?

Since 1988, the CDC has reported a 99% reduction in bacterial meningitis caused by Haemophilus influenzae, due to the introduction of the vaccine against it.

Did you know?

More than 4.4billion prescriptions were dispensed within the United States in 2016.

Did you know?

Asthma occurs in one in 11 children and in one in 12 adults. African Americans and Latinos have a higher risk for developing asthma than other groups.

Vision with macular degeneration is experienced with an inability to focus in the center of the visu Vision with macular degeneration is experienced with an inability to focus in the center of the visu
The eight α-helical segments (shown here as cylinders) are labeled A through H The eight α-helical segments (shown here as cylinders) are labeled A through H
Three days after the Boston Marathon explosion, the FBI released this photograph that had been taken Three days after the Boston Marathon explosion, the FBI released this photograph that had been taken
Karen McCoy, Considering Mother's Mantle, project for Stone Quarry Hill Art Park, Cazenovia, ... Karen McCoy, Considering Mother's Mantle, project for Stone Quarry Hill Art Park, Cazenovia, ...
A multiport fuel injector. Notice that the fuel flows straight through and does not come in contact ... A multiport fuel injector. Notice that the fuel flows straight through and does not come in contact ...
The obese (ob) mouse mutant, shown on the left (a normal mouse is on the right), has provided many c The obese (ob) mouse mutant, shown on the left (a normal mouse is on the right), has provided many c
Video: Role of the respiratory system - effect of altered ventilation rates

For a complete list of videos, visit our video library