Question
Able Corporation has Project A with the following cash flows and a 6.8% cost of money: Numbers in parentheses are outflows. Both Year 0 and
Able Corporation has Project A with the following cash flows and a 6.8% cost of money: Numbers in parentheses are outflows. Both Year 0 and Year 3 cash flows are outflows.
Year 0 1 2 3 4 5 6
Cash flow $(351,000) $ 95,000 $180,000 $(280,000) $ 280,000 $260,000 $180,000
1.Please calculate the net present value.
2.Please calculate the profitability indexes (two decimal places).
3.Please calculate the modified profitability index using the terminal value approach in the textbook (two
decimals places).
4.Please calculate the internal rate of return (two decimals places).
5.Please calculate the modified internal rate of return (two decimals please and per the book.
6.Please calculate the payback period (two decimals places ).
7.Please calculate the present value payback period (two decimals places).
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