A company is looking to invest in a very risky project. They have ...

[dbose]

Question 1

A company has the following net cash inflows. Today -$7000, Year 1 -$15 000, Year 2 -$9000, Year 3 + $12 000, Year 4 -$3000, Year 5 + $19 000. Compute the net present value if the required rate of return is 7.22% compounded annually.
◦ -$3000.00
◦ -$4709.89
◦ $4709.89
◦ -$7409.89
◦ -$7009.89

Question 2

A company is looking to invest in a very risky project. They have a required rate of return of 27% compounded annually. The project has the following cash inflows: Year 1 $17500, Year 2 $15000, Year 3 $27500. It also has the following cash outflows: Immediately -$10 000, Year 1 -$15 000, Year 3 -$9500. What is the NPV?
◦ $9718.06
◦ $7819.06
◦ $7918.06
◦ $9918.06
◦ -$9718.06

[debra928]

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[dbose]

Excellent

[debra928]

Great! Please up vote

[Mankaran Deol]

<p><span class="q_bt">Question 1</span></p>A company has the following net cash inflows. Today -$7000, Year 1 -$15 000, Year 2 -$9000, Year 3 + $12 000, Year 4 -$3000, Year 5 + $19 000. Compute the net present value if the required rate of return is 7.22% compounded annually.<br/>◦ -$3000.00<br/>◦ -$4709.89<br/>◦ $4709.89<br/>◦ -$7409.89<br/>◦ -$7009.89<br/><br/><p><span class="q_bt">Question 2</span></p>A company is looking to invest in a very risky project. They have a required rate of return of 27% compounded annually. The project has the following cash inflows: Year 1 $17500, Year 2 $15000, Year 3 $27500. It also has the following cash outflows: Immediately -$10 000, Year 1 -$15 000, Year 3 -$9500. What is the NPV?<br/>◦ $9718.06<br/>◦ $7819.06<br/>◦ $7918.06<br/>◦ $9918.06<br/>◦ -$9718.06