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Hi there, can you please answer these parts in a neat format please, it will be much appreciated. Will give upvote. Thanks :D {NO EXCEL}
Hi there, can you please answer these parts in a neat format please, it will be much appreciated. Will give upvote. Thanks :D {NO EXCEL}
PART A 10 Marks Exclusivity Inc. is considering raising financing through a bond offering. The Finance Manager is trying to ascertain a reasonable price given current market conditions and the company's credit ratings. Details of the proposed bond offering are provided below: Required: Given a current yield to maturity of 5.80%, how much should an investor be willing to pay for $1,000 face value of this bond? (10 Marks) PART B 15 Marks You have been tasked with evaluating the quantitative aspects of the two (2) mutually exclusive projects that Exclusivity Inc. is considering:- to either Repair or Replace an existing machine. The projected cash flows of both projects are as follows: The company currently assumes a required return of 12%, for simplicity. The following PV factors are provided: Required: (a) Evaluate the projects using each of the following criteria, stating which project(s) Exclusivity Inc. should choose under each criteria and why: i. Discounted Payback (6 Marks) ii. Net Present Value (3 Marks) (b) Compute the Internal Rate of Return for the Repair project only, given that it falls between 12% and 14%. (6 Marks)Step by Step Solution
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