Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please help me slove this problem. Annual cash flows from two competing investment opportunities are given. Each investment opportunity will require the same initial investment

please help me slove this problem.
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Annual cash flows from two competing investment opportunities are given. Each investment opportunity will require the same initial investment (Click the icon to view the competing investment opportu Click the icon to view the Present Ve of table) Data table Requirement 1. Assuming a 10% interest rate, which investment opportu Investment A Investment Begin by computing the present value of each investment op Year 1 $ 6,000 $ 13.000 fusing present at tables, use factor amounts rounded to three decimal places, X.XXX. Round intermediary comput Year 2 7.000 13,000 The present value of investment opportunity Als Year 3 20,000 13.000 The present value of investment opportunity Bis S 39.000 $ 30,000 Total for opponunty A Investment opportunity B should be chosen because the Print Done Annual cash flows from two competing investment opportunities are given. Each investment opportunity will require the same initial investment Click the icon to view the competing investment opportunities) Click the icon to view the Present Value of table Click the icon to view the Present Value of Arrulty of 51 table) Requirement 1. Assuming a 10% interest ratowych Investment opportunity would you choose? Begin by computing the present value of each investment opportunity. (Asume that the annual cash flow occur at the end of each year I ning prosent valuables un factor amounts rounded to three decimal placen, XXXX Round intermediary computations and your final answer to the nearest whole dotar) The present value of Investment opportunity Ais The present value of investment opportunity is Investment opportunity B should be chosen because the present value of cash flows in Higher than the present value of investment opportunity A hantal points possible Present value of $1 x wo come w the cod w the Pro Periods 4% Present Value of $1 7% 8% 5% 6% 10% 12% 14% 16% erest rate resent .XXX. ples, use fac estmen Period 1 0.962 Period 2 0.925 Period 3 0.889 Period 4 0.855 Period 5 0.822 Period 6 0.790 Period 7 0.760 Period 8 0.731 Period 9 0.703 Period 100.676 Period 110.650 Period 12 0.625 Period 13 0.601 0.952 0.907 0.864 0.823 0.784 0.746 0.711 0.677 0.645 0.614 0.585 0.557 0.530 0.943 0.890 0.840 0.792 0.747 0.705 0.665 0.627 0.592 0.558 0.527 0.497 0.469 0.935 0.873 0.816 0.763 0.713 0.666 0.623 0.582 0.544 0.508 0.475 0.444 0.415 0.926 0.857 0.794 0.735 0.681 0.630 0.583 0.540 0.500 0.463 0.429 0.397 0.368 0.909 0.826 0.751 0.683 0.621 0.564 0.513 0,467 0.424 0.386 0.350 0.319 0.290 0.893 0.797 0.712 0.636 0.567 0.507 0.452 0.404 0.361 0.322 0.287 0.257 0.229 0.877 0.769 0.675 0.592 0.519 0.456 0.400 0.351 0.308 0.270 0.237 0.208 0.182 0.862 0.743 0.641 0.552 0.476 0.410 0.354 0.305 0.263 0.227 0.195 0.168 0.145 estmer shol | Print Done ha: 00:07: Present value of annuity of $1 Annual cash flows from two como (Click the icon to view the co (Click the icon to view the Pr Present Value of Ordinary Annuity of 51 6% 7% 8% 10% 12% Periods 4% 5% 14% 16% Requirement 1. Assuming a 10% interest rated plus Begin by computing the present to three decimal places, X.XXX. The present value of investmer The present value of investmer Investment opportunity B shol Period 1 0.962 Period 2 1.886 Period 3 2.775 Period 4 3.630 Period 5 4.452 Period 6 5.242 Period 7 6.002 Period 8 6.733 Period 9 7.435 Period 10 8.111 Period 11 8.760 Period 12 9.385 Period 13 9.986 0.952 1.859 2.723 3.546 4.329 5076 5.786 6.463 7.108 7.722 8.306 8.863 9.394 0.943 1.833 2.673 3,465 4.212 4.917 5.582 6.210 6.802 7 360 7887 8.384 8.853 0.935 1.800 2624 3.387 4.100 4.767 5.389 5.971 6.515 7.024 7.499 7.943 8.358 0.926 1.783 2.577 3.312 3.993 4.623 5 206 5.747 6.247 6.710 7.139 7.536 7.904 0.909 1.730 2487 3.170 3.791 4355 4.868 5335 5.759 6.145 6.495 6.814 7.103 0.893 1.600 2.402 3037 3.605 4.111 4.564 4.968 5.328 5.650 5.938 6.194 6.424 0.877 1.647 2.322 2.914 3.433 3.889 4 288 4.639 4.946 5.216 5.453 5.660 5.842 0.862 1.606 2.246 2.798 3.274 3.685 4039 4344 4.607 4.833 5.020 5.197 5 342 Print Done

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Accounting questions