Answer Happy

00 8 Consider the following cash flows: Year 10 points 0 Cash Flow $33,000 14,400 17,300 11,800 Skipped 1 2 3 eBook Hint a. What is the NPV at a discount rate of zero percent? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) b. What is the NPV at a discount rate of 12 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the NPV at a discount rate of 23 percent? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) d. What is the NPV at a discount rate of 32 percent? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Print a. Net present value b. Net present value c. Net present value d. Net present value

9 Bausch Company is presented with the following two mutually exclusive projects. The required return for both projects is 16 percent. 15 points Skipped Year 0 1 2 3 4 Project M -$136,000 63,900 81,900 72,900 58,900 Project N -$359,000 150,500 184,000 135,500 114,000 eBook a. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. Which, if either, of the projects should the company accept? Print % % a. Project M Project N b. Project M Project N c. Accept project

10 Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 13 percent. 15 points Year Project F Project G 0 Skipped 1 2 3 4 5 $127,000 64,000 46,000 56,000 51,000 46,000 $197,000 44,000 59,000 86,000 116,000 131,000 eBook Print a. Calculate the payback period for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. Calculate the NPV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. Which project, if any, should the company accept? years years a. Project F Project G b. Project F Project G C.

11 The Yurdone Corporation wants to set a private cemetery business. According to the CFO, Barry M. Deep, business is looking up." As a result, the cemetery project will provide a net cash inflow of $116,000 for the firm during the first year, and the cash flows are projected to grow at a rate of 5.9 percent per year forever. The project requires an initial investment of $1,390,000. 15 points Skipped a. If the company requires a return of 13 percent on such undertakings, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. The company is somewhat unsure about the assumption of a growth rate of 5.9 percent in its cash flows. At what constant growth rate would the company just break even if it still required a return of 13 percent on its investment? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) eBook Print a. NPV b. Minimum growth rate %