Q1.

Q2.

DeBarry Corporation makes an investment of $59,000 that ylelds the following cash flows: Year 1 2 3 4 5 Cash Flow $20,888 20,000 26,eee 28,888 30,000 a. What is the present value with a 9 percent discount rate (cost of capital)? (Use a Financial calculator to arrive at the answers. Do not round Intermediate calculations. Round the final answer to the nearest whole dollar.) Net present value $ b. What is the IRR? (Do not round Intermediate calculations. Round the final answer to 2 decimal places.) IRR % c. Would you make the same decision under both parts a and b? Yes O NO Altman Hydraulic Corporation will Invest $180,000 in a project that will produce the following cash flows. The cost of capital is 11 percent. (Some projects may incur negative cash flows In later years, such as a mining project that may have to restore lands to their original condition after extracting the ore and when positive cash flows dwindle.) Year 1 2 3 4 5 Cash Flow $62, eee 74, eee (68, eee) 65, eee 140, eee a. What is the net present value of the project? (Round the Intermediate calculations to the nearest whole dollar. Round the final answer to the nearest whole doller. Negative answer should be indicated by a minus sign.) Net present value b. Should the project be undertaken? Yes O No