Question
NPV Calculate the net present value (NPV) for the following 15-year projects. Comment on the acceptability of each. Assume that the firm has a cost
NPV Calculate the net present value (NPV) for the following 15-year projects. Comment
on the acceptability of each. Assume that the firm has a cost of capital of 9%.
a. Initial investment is $1,000,000; cash inflows are $150,000 per year.
b. Initial investment is $2,500,000; cash inflows are $320,000 per year.
c. Initial investment is $3,000,000; cash inflows are $365,000 per year.Step by Step Solution
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Step: 1
a Initial Investment 1000000 PV of Cash flows 9 Year 1 150000 13761468 Year 2 150000 12625200 Year 3 ...
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Step: 2
Step: 3
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Introduction to Corporate Finance What Companies Do
Authors: John Graham, Scott Smart
3rd edition
9781111532611, 1111222282, 1111532613, 978-1111222284
