Question
DeBarry Corporation makes an investment of $60,000 that yields the following cash flows: Year Cash Flow 1 $21,000 2 21,000 3 27,000 4 29,000 5
DeBarry Corporation makes an investment of $60,000 that yields the following cash flows: Year Cash Flow 1 $21,000 2 21,000 3 27,000 4 29,000 5 31,000 a. What is the present value with a 7 percent discount rate (cost of capital)? (Use a Financial calculator to arrive at the answers. Do not round intermediate calculations. Round the final answer to the nearest whole dollar.) Net present value $ b. What is the IRR? (Do not round intermediate calculations. Round the final answer to 2 decimal places.) IRR % c. Would you make the same decision under both parts a and b? multiple choice Yes or No
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started