Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Integrative Complete investment decision in the market price of gol 31,500 perc Cards e Canadian dollars Martine Resouro Comp Canadian mining firm, would like to

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Integrative Complete investment decision in the market price of gol 31,500 perc Cards e Canadian dollars Martine Resouro Comp Canadian mining firm, would like to meet the financial ability of recpening 5 year operating life can recover 175,000 euros el gold from the more and that the project will have to terminal value Maritime is straight the depreciation, as a 71.1% corporate tax rate, and to cost of pw. Before moving forward with the Maritime would like to determine the writy of capital ging decision to the market price of golwich could use over the year period Calculate the email me for meget mere the price rope 10% Culote te tera tale of more pol ure he will dros 20% 4. Caledele e nel present for the gold mine egres 20 Below what price per one of gods Martin's ring of mine no longer the price of gold up to the intamal rate of retam (IRR) for the gold mine project in Round to two decimal places) The price of gold drops to the represente (NPV) for the godine project Round to the recent c. If the price of gold drope 20%, the intamal rate of om (RR) for the gold mine projects found to two decimal places) d the price of gold drops 2016. The represent value INPV) for the gold mine prend und to the recent) . Martine's reopening of its old mine no longer table once the price per curce of gold Round to the nearest cent) Integrative: Complete Investment decision With the market price of gold at C$1,562.50 per ounce (C$ stands for Canadian dollars), Maritimo R an old gold mine that had ceased operations in the past due to low gold prices, Reopening the mine would require an up-front capital expenditure 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight-lin moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10% b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10% c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20% d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20% e. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $ . (Round to the nearest cent.) Integrative: Complete investment decision With the market price of gold at C$1,562,50 per ounce (C$ stands for Canadian dollars), Maritime Resources Corp., a Canadian mining firm, would like to assess the financial feasibility of reopening an old gold mine that had ceased operations in the past due to low gold prices. Reopening the mine would require an up-front capital expenditure of C$67.7 million and annual operating expenses of C$19.37 million Maritime expects that over a 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight line depreciation, has a 21.13% corporate tax rate, and has a(n) 10.8% cost of capital. Before moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which could fluctuate over the 5-year period. a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10%. b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10%. c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20%. d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20% e. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $. (Round to the nearest cent.) Integrative: Complete investment decision With the market price of gold at C$1,562.50 per ounce (C$ stands for Canadian dollars), Maritime Resources Corp., a Canadian mining firm, would like to assess the financial feasibility of reopening an old gold mine that had ceased operations in the past due to low gold prices, Reopening the mine would require an up-front capital expenditure of C$67.7 million and annual operating expenses of C$19.37 million Maritime expects that over a 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight-line depreciation, has a 21.13% corporate tax rate, and has a(n) 10.8% cost of capital. Before moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which could fluctuate over the 5-year period. a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10%. b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10% c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20%. d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20%. o. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $. (Round to the nearest cent.) Integrative Complete investment decision in the market price of gol 31,500 perc Cards e Canadian dollars Martine Resouro Comp Canadian mining firm, would like to meet the financial ability of recpening 5 year operating life can recover 175,000 euros el gold from the more and that the project will have to terminal value Maritime is straight the depreciation, as a 71.1% corporate tax rate, and to cost of pw. Before moving forward with the Maritime would like to determine the writy of capital ging decision to the market price of golwich could use over the year period Calculate the email me for meget mere the price rope 10% Culote te tera tale of more pol ure he will dros 20% 4. Caledele e nel present for the gold mine egres 20 Below what price per one of gods Martin's ring of mine no longer the price of gold up to the intamal rate of retam (IRR) for the gold mine project in Round to two decimal places) The price of gold drops to the represente (NPV) for the godine project Round to the recent c. If the price of gold drope 20%, the intamal rate of om (RR) for the gold mine projects found to two decimal places) d the price of gold drops 2016. The represent value INPV) for the gold mine prend und to the recent) . Martine's reopening of its old mine no longer table once the price per curce of gold Round to the nearest cent) Integrative: Complete Investment decision With the market price of gold at C$1,562.50 per ounce (C$ stands for Canadian dollars), Maritimo R an old gold mine that had ceased operations in the past due to low gold prices, Reopening the mine would require an up-front capital expenditure 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight-lin moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10% b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10% c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20% d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20% e. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $ . (Round to the nearest cent.) Integrative: Complete investment decision With the market price of gold at C$1,562,50 per ounce (C$ stands for Canadian dollars), Maritime Resources Corp., a Canadian mining firm, would like to assess the financial feasibility of reopening an old gold mine that had ceased operations in the past due to low gold prices. Reopening the mine would require an up-front capital expenditure of C$67.7 million and annual operating expenses of C$19.37 million Maritime expects that over a 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight line depreciation, has a 21.13% corporate tax rate, and has a(n) 10.8% cost of capital. Before moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which could fluctuate over the 5-year period. a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10%. b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10%. c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20%. d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20% e. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $. (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $. (Round to the nearest cent.) Integrative: Complete investment decision With the market price of gold at C$1,562.50 per ounce (C$ stands for Canadian dollars), Maritime Resources Corp., a Canadian mining firm, would like to assess the financial feasibility of reopening an old gold mine that had ceased operations in the past due to low gold prices, Reopening the mine would require an up-front capital expenditure of C$67.7 million and annual operating expenses of C$19.37 million Maritime expects that over a 5-year operating life it can recover 175,000 ounces of gold from the mine and that the project will have no terminal value. Maritime uses straight-line depreciation, has a 21.13% corporate tax rate, and has a(n) 10.8% cost of capital. Before moving forward with the project, Maritime would like to determine the sensitivity of its capital budgeting decision to the market price of gold, which could fluctuate over the 5-year period. a. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 10%. b. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 10% c. Calculate the internal rate of return (IRR) for the gold mine project if the price of gold drops 20%. d. Calculate the net present value (NPV) for the gold mine project if the price of gold drops 20%. o. Below what price per ounce of gold is Maritime's reopening of its old mine no longer acceptable? a. If the price of gold drops 10%, the internal rate of return (IRR) for the gold mine project is % (Round to two decimal places.) b. If the price of gold drops 10%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) c. If the price of gold drops 20%, the internal rate of return (IRR) for the gold mine project is %. (Round to two decimal places.) d. If the price of gold drops 20%, the net present value (NPV) for the gold mine project is $ (Round to the nearest cent.) e. Maritime's reopening of its old mine no longer acceptable once the price per ounce of gold is $. (Round to the nearest cent.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Foundations Of Financial Management

Authors: Stanley B Block, Geoffrey A Hirt

12th Edition

0073295817, 9780073295817

More Books

Students also viewed these Finance questions