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1. Project A has a cost of $7,000, its expected cash inflow at Year 2 is $9,000 and its cost of capital is 10%. What
1. Project A has a cost of $7,000, its expected cash inflow at Year 2 is $9,000 and its cost of capital is 10%. What is the projects NPV and IRR?
| NPV | IRR |
a. | $1,182 | 28.57% |
b. | $438 | 28.57% |
c. | $1,182 | 13.39% |
d. | $438 | 13.39% |
2. ABC company has the following financial information: Net operating profit after taxes $18,000 Capital expenditures 10,000 Depreciation expense 8,000 Change in working capital 4,000
What amount is the companys free cash flow?
a. $4,000 b. $8,000 c. $12,000 d. 16,000
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