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HW 6 (Chapter 7-Investment Rules) due before 3/6/2023 11:59 pm Please show all your work to receive full credit. 1- Answer the problems below.
HW 6 (Chapter 7-Investment Rules) due before 3/6/2023 11:59 pm Please show all your work to receive full credit. 1- Answer the problems below. Cash Flows (5) Project A -5,000 +1,000 +1,000 +3,000 B -1,000 0 +1,000 +2,000 +3,000 C -5,000 +1,000 +1,000 +3,000 +5,000 a. What is the payback period on each of the above projects? (1 Point) b. Given that you wish to use the payback method with a cutoff period of two years, which projects would you accept? (1 point) c. If you use a cutoff period of three years, which projects would you accept? (1 Point) d. If the opportunity cost of capital is 10%, which projects have positive NPVs? (3 Points) 2-Consider a project with the following cash flows: Cash Flows ($) Co G -100 +200 -75 a. How many internal rates of return does this project have? (1 Point) b. The opportunity cost of capital is 14%. Is this an attractive project? Briefly explain. (2 Points)
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