Question
1. A project has an initial outlay of $1,732. The project will generate annual cash flows of $783 over the 4-year life of the project
1. A project has an initial outlay of $1,732. The project will generate annual cash flows of $783 over the 4-year life of the project and terminal cash flows of $258 in the last year of the project. If the required rate of return on the project is 4%, what is the net present value (NPV) of the project? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box.
2.A project has an initial outlay of $11,596. The project will generate cash flows of $7,200 in Years 1-4. What is the profitability index (PI) of this project? Assume an interest rate of 13%.Note: Enter your answer rounded off to two decimal points.
3.ABC, Inc., has a beta of 1.19. The risk-free rate is 2.91% and the market risk premium is 7.89%. What is the required rate of return on ABC's stock?Note: Convert your answer to percentage and round off to two decimal points.
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