Question
Dragon Products Company is considering two projects. The projects cash flows are as follows: Cash Flow PROJECT A 0 ($10300) 1 2500 2 1730 3
Dragon Products Company is considering two projects. The projects cash flows are as follows:
Cash Flow PROJECT A 0 ($10300) 1 2500 2 1730 3 1500 4 3600 5 3100 6 1200 Discount Rate 5.8%
REQUIRED
1. Find the Payback Period 2. What is the discounted PBP?
3. Calculate the Net Present Value of the project and? 4. What is the profitability index of ?
5. Calculate the IRR of the project using trial and error method.. 6. Why is sunk cost not considered when deciding about selecting a project? Which cost is considered and why?
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Sound Investing, Chapter 15 - Liability Tricks
Authors: Kate Mooney
2nd Edition
0071719377, 9780071719377
