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begin{tabular}{|c|r|} hline Discount rate & 15% hline & hline & hline Date & Cash flow hline 2-May-18 & 500 hline
\begin{tabular}{|c|r|} \hline Discount rate & 15% \\ \hline & \\ \hline & \\ \hline Date & Cash flow \\ \hline 2-May-18 & 500 \\ \hline 14-Feb-19 & 100 \\ \hline 14-Feb-20 & 300 \\ \hline 14-Feb-21 & 400 \\ \hline 14-Feb-22 & 600 \\ \hline 14-Feb-23 & 800 \\ \hline 14-Feb-24 & 1,800 \\ \hline \end{tabular} Question 2: ( 2 points) Consider a project that costs $500 today The project is expected to generate the following cash flows as listed in the table Calculate the IRR and the NPV. Assuming a discount rate of 15%, would you invest in this project ? Why? Justify your answers. Discuss your analysis. Build a chart of the NPV as a function of different discount rates. Hint: Use the appropriate Excel function to conduct a sensitivity analysis Question 1: (2 points) After taking many finance classes and landing a very good job, you made a decision to be a home owner. The question you have is how much you can afford to borrow for a home right away if you can make annual payments of $27,300 per year for 30 years at 4% ? What about for a monthly payment of \$2,300? Which option would you choose: the annual or the monthly payments? Why? Discuss. Show your formulas in the orange cell next to the outcome calculation. You also made a decision to purchase a car. What would your monthly payments be for a $40,000 car loan over five years at 2.99%
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