Question
1.A real estate investment has the following expected cash flows: YEAR CASH FLOW 0 -$102,359.00 1 $13,862.00 2 $28,729.00 3 $50,167.00 4 $41,494.00 The investor
1.A real estate investment has the following expected cash flows:
| YEAR | CASH FLOW |
|---|---|
| 0 | -$102,359.00 |
| 1 | $13,862.00 |
| 2 | $28,729.00 |
| 3 | $50,167.00 |
| 4 | $41,494.00 |
The investor wants a 9.00% return on this investment. What is the NPV of this opportunity?
2.A new IT server for a company will cost $447,481.00 today. The company expects the server will create an incremental cash flow to the firm of $130,370.00 per year. The company wants an 10.00% return for all capital budgeting projects. The company will run the server for the next 5 years.
What is the NPV of this project?
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Contemporary Financial Management
Authors: James R Mcguigan, R Charles Moyer, William J Kretlow
10th Edition
978-0324289114, 0324289111
