1. Firm A has expected to receive the following cash flows from an investment. time cash flow 1 300 2 200 3 150 4 100 a.
Posted: Sun Apr 10, 2022 8:42 am
1. Firm A has expected to receive the following cash flows from
an investment. time cash flow
1 300
2 200
3 150
4 100
a. What is the present value of the cash flows described below
if interest rate is 10%?
b. If the investment costs $650 today, use Excel IRR to find the
internal rate of return of the investment? Should Firm A accept the
investment?
2. Firm A invests $100 million today at a rate of 10%.
a. What will be the future value in 20 years using annual
compounding.
b. Use Excel Scenario to show the future value with annual,
quarterly and monthly compounding.
an investment. time cash flow
1 300
2 200
3 150
4 100
a. What is the present value of the cash flows described below
if interest rate is 10%?
b. If the investment costs $650 today, use Excel IRR to find the
internal rate of return of the investment? Should Firm A accept the
investment?
2. Firm A invests $100 million today at a rate of 10%.
a. What will be the future value in 20 years using annual
compounding.
b. Use Excel Scenario to show the future value with annual,
quarterly and monthly compounding.