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A = = c) A project with an initial cost of GHGH500,000 has the following forecasted cash inflows: Year Cashflows (GH) 1 150,000 2 200,000

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A = = c) A project with an initial cost of GHGH500,000 has the following forecasted cash inflows: Year Cashflows (GH) 1 150,000 2 200,000 3 250,000 4 300,000 5 320,000 The estimated project beta is 1.2. The market return is 19%, and the risk-free rate is 10%. Required:) i) COpute the opportunity cost of capital and the project's Present Value (2 Marks) ii) Indicate the annual Certainty Equivalent cashflows (2 Marks) iii) What is the ratio of Certainty Equivalent cash flow to the expected cash flow in each nase2 More

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