Thankyou for the help. Answer has to be through excel.
Posted: Sun May 08, 2022 8:49 am
Thankyou for the help. Answer has to be through excel.
QUESTION 2 Consider the following cash flows reported in nominal terms (current year prices): Year 3 5 Net Benefit -750 251 267 lo 1 2 14 237 244 259 Assuming the nominal discount rate is equal to the nominal interest rate, the inflation rate is 3% and the real interest rate is 5%. Find the following a) The nominal discount rate is b) The nominal net present value is: $ c) The nominal internal rate of return for the project is: % d) If the hurdle rate is 15% the investor should (accept/reject) the project. Provide a detailed reason in your spreadsheet. Provide a detailed explanation in your spreadsheet. Show all working in Excel. Marks will be deducted if you do not explain your answers.
QUESTION 2 Consider the following cash flows reported in nominal terms (current year prices): Year 3 5 Net Benefit -750 251 267 lo 1 2 14 237 244 259 Assuming the nominal discount rate is equal to the nominal interest rate, the inflation rate is 3% and the real interest rate is 5%. Find the following a) The nominal discount rate is b) The nominal net present value is: $ c) The nominal internal rate of return for the project is: % d) If the hurdle rate is 15% the investor should (accept/reject) the project. Provide a detailed reason in your spreadsheet. Provide a detailed explanation in your spreadsheet. Show all working in Excel. Marks will be deducted if you do not explain your answers.