You are considering investing in a start up company. The founder asked you for $230,000 today and you expect to get $1,0
Posted: Wed Apr 06, 2022 9:04 am
You are considering investing in a start up company. The founder
asked you for $230,000 today and you expect to get $1,080,000 in 12
years. Given the riskiness of the investment​ opportunity, your
cost of capital is 30%. What is the NPV of the investment​
opportunity? Should you undertake the investment​ opportunity?
Calculate the IRR and use it to determine the maximum deviation
allowable in the cost of capital estimate to leave the decision
unchanged.
asked you for $230,000 today and you expect to get $1,080,000 in 12
years. Given the riskiness of the investment​ opportunity, your
cost of capital is 30%. What is the NPV of the investment​
opportunity? Should you undertake the investment​ opportunity?
Calculate the IRR and use it to determine the maximum deviation
allowable in the cost of capital estimate to leave the decision
unchanged.