Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1 o N 1 You are considering a project with an initial cost of $27,900. What is the payback period for this project if the

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
1 o N 1 You are considering a project with an initial cost of $27,900. What is the payback period for this project if the cash inflows are $14,650, $16,190, $12,480, and $9,500 a year over the next four years, respectively? Multiple Choice 0.82 year 0.90 year 1.11 years 1.82 years 1.90 years What is the internal rate of return for a project with the following cash flows? 2 Year O 1 Cash Flow $69,000 $35,500 $28,000 $21,500 2 3 Multiple Choice O 11.9 % O 12.1% O 12.3 % O 12.3 % O 12.5% 12.7 % ABC Inc. is looking at investing in a 3-year project that will create cash inflows of $7,000 in the first year, $8,000 in the second year, and $9,000 in the third year. The cost of this project is $18,000, and the required return is 12%. Calculate ABC's IRR for this project. Multiple Choice 12.36% 13.75% 15.17% 16.15% 16.98% ABC Inc. is looking at investing in a 3-year project that will create earnings before depreciation of $7,000 in the first year, $8,000 in the second year, and $9,000 in the third year. The cost of equipment needed for this project is $18,000, which will be depreciated on a straight-line basis to zero over the next 3 years. The tax rate is 30% and the required return is 12%. What is the accounting rate of return of this project? Multiple Choice 12.23% 13.34% 14.45% 15.56% 5.56% 16.57%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essential Mathematics For Economic Analysis

Authors: Knut Sydsaeter, Peter Hammond, Arne Strom

4th Edition

0273760688, 9780273760689

More Books

Students also viewed these Finance questions