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i neeed help Please double check your to see if they'are right make sure to do all the questions !! 1). You are considering an
i neeed help Please double check your to see if they'are right make sure to do all the questions !!
1). You are considering an investment project with the cash flows of -300 (the initial cash flow), 800 (cash flow at year 1), -200 (cash flow at year 2). Given the discount rate of 10%, compute the Modified Internal Rate of Return (MIRR) using the discountingapproach.
19.72%
71.94%
37.52%
50.55%
2). A firm is reviewing a project that has an initial cost of $50,000. The project will produce cash inflows, starting with year 1, of $10,000, $20,000, $30,000, and finally in year 4, $40,000. What is the profitability index if the discount rate is 18 percent?
1.46
1.23
1.34
1.12
3). The net present value:
is inversely to the discount rate.
method of analysis cannot be applied to mutually exclusive projects.
is equal to the intial investment when the internal rate of return to the required return.
increases as the required rate of return increases.
4. Madrid Co. just announced that it will commence paying annual dividends. It plans to pay $5.5 a year for four years, $4.0 a year for the following three years, and then cease paying dividends altogether. How much is one share of this stock worth to you today if you require a 10 percent rate of return?
$26.82
$20.17
$22.45
$24.23
5). Lisbon Inc. is considering a project with an initial cost of $1 million. The project will not produce any cash flows for the first two years. Starting in year 3, the project will produce cash inflows of $600,000 a year for five years. This project is risky, so the firm has assigned it a discount rate of 20 percent. What is the net present value?
331,185.79
104,482.91
246,088.39
406,141.27
6). Bangkok Co. is considering a project that will produce cash inflows of $50,000 a year for three years followed by $60,000 a year for the following four years. What is the internal rate of return if the initial cost of the project is $200,000?
19.16 percent
13.47 percent
17.64 percent
15.25 percent
7). Taipei Co. increases its annual dividend by 4 percent each year. The common stock has a market price of $50 a share on a required return of 12 percent. What is the amount of the last dividend this company paid ?
$1.60
$4.00
$2.25
$3.85
8). Cancun Store will pay an annual dividend of $7.20 next year. The company just announced that future dividends will be increasing by 3 percent annually. How much are you willing to pay for one share of this stock if your required return is 11 percent?
$90.00
$62.50
$82.12
$75.00
9). Beijing Co. has 80,000 shares outstanding. There are 4 directors up for election. How many shares do you need to have if you want to ensure that you get to select one director, if the company uses straightvoting?
40,001
12,001
20,001
16,001
10). Dubai Co. has not kept pace with the times and is slowly seeing its sales and market share decline. Based on this trend, the firm recently announced that its next annual dividend will be $5.0 a share and that all future dividends will be decreased by 1 percent annually. You require a 7 percent rate of return on this stock. What is one share of this stock worth to you today?
$32.80
$62.50
$53.33
$47.50
11). Sydney Co. is growing at a very fast rate. As a result, the company expects to increase its dividend to $1.00, $1.50, and $2.00 over the next three years, respectively. After that, the dividend is projected to increase by 4 percent annually. What is the current value of this stock if the required return is 14 percent?
$22.80
$17.42
$20.80
$15.05
12). Santiago Co. is considering a project that will produce cash inflows of $500,000 a year for five years followed by $200,000 a year for the following two years. What is the internal rate of return if the initial cost of the project is $1.5 million?
21.27 percent
27.48 percent
25.81 percent
23.18 percent
13). Lima Club is considering adding a miniature golf course to its facility. The course would cost $40,000, would be depreciated on a straight-line basis over its 4-year life, and would have a zero salvage value. The estimated income from the golfing fees would be $70,000 a year with $15,000 of that amount being variable cost. The fixed cost would be $5,000. The project will require $4,000 of net working capital, which is recoverable at the end of the project. What is the net present value of this project at a discount rate of 12 percent and a tax rate of 21 percent?
77,127.17
84,895.81
98,180.50
65,020.62
14). A project has an initial requirement of $300,000 for fixed assets and $30,000 for net working capital. The fixed assets will be depreciated to a zero book value over the 3-year life of the project and have an estimated salvage value of $80,000. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $160,000 and the discount rate is 10 percent. What is the project's net present value if the tax rate is 21 percent?
110,374.24
197,365.60
137,918.86
154,277.28
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