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lake Signent/takeAssignment MandolinvokerStakeAssignmentSessionLocator Sinprogress false eBook Print Item Net Present Value Method, Internal Rate of Return Method, and Analysis The management of Advanced Alternative Power

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lake Signent/takeAssignment MandolinvokerStakeAssignmentSessionLocator Sinprogress false eBook Print Item Net Present Value Method, Internal Rate of Return Method, and Analysis The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows: Year Wind Turbines Biofuel Equipment 1 $240,000 $430,000 2 430,000 3 240,000 240,000 240,000 430,000 430,000 4 Present Value of an Annuity of $1 at Compound Interest Year 109 12% 15% 20% . 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.523 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.352 2.991 5 4.917 4.355 3.734 3.326 7 5.582 4.868 4,564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 5.802 5.759 4.772 10 77360 6.145 5.650 5:019 gi de um Di VC & 6 7 00 9 O v L. 49 6 takeAssignment/takeAssignment Main doinvokerStake AssignmentSession Locator Sinprogress=false * eBook Print Item Present Value of an Annuity of $1 at Compound Interest Year 696 10% 12% 15% 20 1 0.943 0.909 0.893 0.670 0.833 1.833 1.736 1.690 1.626 1.528 2.673 2.487 2.402 2.203 2.105 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.352 2.991 6 4.917 4.JSS 4.111 3.784 3.326 7 5.582 4.860 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 5.302 5.759 5.328 4.772 4.031 10 6.145 5.650 5.019 4.192 The wind turbines require an investment of $728,880, while the biofuel equipment requires an investment of S1,227,650. No residual value is expected from either project. Required: 1a. Compute the net present value for each project. Use a rate of 10% and the present value of an annuity of S1 in the table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest whole dollar. Wind Turbines Biofuel Equipment Present value of annual net cash flows Less amount to be invested 7.360 . num prt SCK & 7 6 8 9 O 3 Max 3 Sol Cox Witax N Nethu x 3 hottub x MX + takeAssignment takeAssignment Main dolinvoket&takeAssignmentSessionLocator Binprogress-false EUR 1a. Compute the net present value for each project. Use a rate of 10% and the present value of an annuity of 51 in the table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest whole dollar Wind Turbines Biofuel Equipment Present value of annual net cash flows Less amount to be invested Net preset value 5 11. Compute a present value inden for each project. If required, round your answers to two decimal places. Present Value Index Wind Turbines Biofael Equipment 2. Determine the Internal rate of return for each project by (a) computing a present value factor for an annuity of sI and (b) using the present value of an annuity of $1 in the table above. If required, round your present value factor answers to three decimal places and internal rate of return to the nearest whole percent. Wind Turbines Biofuel Equipment Present value factor for an annuity of $1 Internal rate of return 3. The net present value, presunt value index, and internal rate of retum all indicate that the is a better financial opportunity compared to the although both investments meet the minimum return criterion of 10%. de numlik pits & olis lake Signent/takeAssignment MandolinvokerStakeAssignmentSessionLocator Sinprogress false eBook Print Item Net Present Value Method, Internal Rate of Return Method, and Analysis The management of Advanced Alternative Power Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows: Year Wind Turbines Biofuel Equipment 1 $240,000 $430,000 2 430,000 3 240,000 240,000 240,000 430,000 430,000 4 Present Value of an Annuity of $1 at Compound Interest Year 109 12% 15% 20% . 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.523 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.352 2.991 5 4.917 4.355 3.734 3.326 7 5.582 4.868 4,564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 5.802 5.759 4.772 10 77360 6.145 5.650 5:019 gi de um Di VC & 6 7 00 9 O v L. 49 6 takeAssignment/takeAssignment Main doinvokerStake AssignmentSession Locator Sinprogress=false * eBook Print Item Present Value of an Annuity of $1 at Compound Interest Year 696 10% 12% 15% 20 1 0.943 0.909 0.893 0.670 0.833 1.833 1.736 1.690 1.626 1.528 2.673 2.487 2.402 2.203 2.105 4 3.465 3.170 3.037 2.855 2.589 5 4.212 3.791 3.605 3.352 2.991 6 4.917 4.JSS 4.111 3.784 3.326 7 5.582 4.860 4.564 4.160 3.605 8 6.210 5.335 4.968 4.487 3.837 5.302 5.759 5.328 4.772 4.031 10 6.145 5.650 5.019 4.192 The wind turbines require an investment of $728,880, while the biofuel equipment requires an investment of S1,227,650. No residual value is expected from either project. Required: 1a. Compute the net present value for each project. Use a rate of 10% and the present value of an annuity of S1 in the table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest whole dollar. Wind Turbines Biofuel Equipment Present value of annual net cash flows Less amount to be invested 7.360 . num prt SCK & 7 6 8 9 O 3 Max 3 Sol Cox Witax N Nethu x 3 hottub x MX + takeAssignment takeAssignment Main dolinvoket&takeAssignmentSessionLocator Binprogress-false EUR 1a. Compute the net present value for each project. Use a rate of 10% and the present value of an annuity of 51 in the table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest whole dollar Wind Turbines Biofuel Equipment Present value of annual net cash flows Less amount to be invested Net preset value 5 11. Compute a present value inden for each project. If required, round your answers to two decimal places. Present Value Index Wind Turbines Biofael Equipment 2. Determine the Internal rate of return for each project by (a) computing a present value factor for an annuity of sI and (b) using the present value of an annuity of $1 in the table above. If required, round your present value factor answers to three decimal places and internal rate of return to the nearest whole percent. Wind Turbines Biofuel Equipment Present value factor for an annuity of $1 Internal rate of return 3. The net present value, presunt value index, and internal rate of retum all indicate that the is a better financial opportunity compared to the although both investments meet the minimum return criterion of 10%. de numlik pits & olis

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