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B . Chapter 14: Applying Excel 1 2 3 4 5 6 $ $ $ 340.000 40.000 30.000 20.000 7 Data Example E Cost of
B . Chapter 14: Applying Excel 1 2 3 4 5 6 $ $ $ 340.000 40.000 30.000 20.000 7 Data Example E Cost of equipment needed Working capital needed Overhaul of equipment in four years Salvage value of the equipment in five years Annual revenues and costs: Sales revenues Cost of goods sold Out-of-pocket operating costs Discount rate 8 $ 9 $ 400.000 10 245.000 11 $ $ 65.000 12 13 10% a. What is the net present value of the project? (Negative amount should be Indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value c. The internal rate of return is between what two whole discount rates (e.... between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between % and 9 d. Reset the discount rate to 10%. Suppose the salvage value is uncertain. How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positive present value
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