Question
A project produces a cash flow of $487 in year 1, $192 in year 2, and $852 in year 3. If the cost of capital
A project produces a cash flow of $487 in year 1, $192 in year 2, and $852 in year 3. If the cost of capital is 14.0%, what is the projects PV? If the project requires an investment of $925, what is its NPV?
- Present value =
- Net present value =
A common stock will pay a cash dividend of $3 next year. After that, the dividends are expected to increase indefinitely at 3% per year. If the discount rate is 14%, what is the PV of the stream of dividend payments?
3. Present Value =
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Contemporary Business Mathematics with Canadian Applications
Authors: S. A. Hummelbrunner, Kelly Halliday, Ali R. Hassanlou, K. Suzanne Coombs
11th edition
134141083, 978-0134141084
