Question
A) Company Y is considering an investment with an initial cost of $175,000 that would be depreciated straight line to a zero book value over
A) Company Y is considering an investment with an initial cost of $175,000 that would be depreciated straight line to a zero book value over the life of the project. The cash inflows generated by the project are estimated at $76,000 for the first two years and $29,000 for the following two years. What is the internal rate of return?
B)Company E is considering a project that will produce cash inflows of $238,000 a year for three years followed by $149,000 in year four. What is the internal rate of return if the initial cost of the project is $749,000?
C)
A project has these cash flows. What is the net present value if the required rate of return is 12%?
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