17 18 Question 2 19 Calculate the NPV and IRR of the following series of cash flows. Assume interest rates are the same as in question #1 above. 20 21 Period Cash Flow NPV IRR 22 0 S (250,000.0) 250,000 23 1 s 55,000.0 24 2 55,000.0 25 3 55,000.0 26 4 s 55,000.0 27 5 S 62,500.0 28 096 29 USU Question 1 3 Calculate the discount factors given the following term structure of interest rate: Spot Rate 10 11 12 13 14 Period 1 2 3 4 5 2.13% 2.88% 3.01% 3.63% 4.25% DF 0.97914 0.9448 0.91488 0.86708 0.81212 15 16 17 18 Question 2 19 Calculate the NPV and IRR of the following series of cash flows. Assume interest rates are the same as in question above 20 21 Period Cash Flow NPV IRR 22 0 $ (250,000.0) 250,000 23 1 $ 55,000.0 24 2 $ 55,000.0 25 3 $ 55,000.0 26 4 S 55,000,0 5 S 62,500.0 096 29 30 Question 3 31 The relationship between the discount rate and NPV is inverse. True of False? 32 33 Type Answer here TRUE 27 28