Question
A project with a $3,100 setup cost will generate an annual cash flow of $850 for each of the next 6 years. Calculate NPV if
A project with a $3,100 setup cost will generate an annual cash flow of $850 for each of the next 6 years. |
Calculate NPV if the discount rate is 11%. (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
| NBD-$ |
How high can the discount rate be before rejecting the project? (Do not round up intermediate calculations. Enter your answer as a percentage, rounded to 2 decimal places.)
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Step by Step Solution
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There are 3 Steps involved in it
Step: 1
To calculate the NPV we need to discount each cash flow to its present value and then sum them up Th...
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Step: 2
Step: 3
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Fundamentals of Corporate Finance
Authors: Richard Brealey, Stewart Myers, Alan Marcus
9th edition
1259722619, 978-1260049190, 1260049191, 978-1259722615
