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Questions 31-40 are four (4) points each. Your employer, Kent, LLC. is considering an investment in an office building that has the following cash flows:
Questions 31-40 are four (4) points each. Your employer, Kent, LLC. is considering an investment in an office building that has the following cash flows: Purchase in Year 0............... $ -2,750,000 Year 1.... 180,000 Year 2..... 276,000 Year 3............ 220,000 Year 4..... 239,000 Year 5 250,000, and a sale @ $3,190,000 takes place EOY 5 The company's weighted average cost of capital that they use as their discount rate for such calculations is 8% 40. Using the company's hurdle rate (discount rate) for leveraged projects of 9.00%, what is the leveraged NPV of the project? a. $ 577,943 b. $ 893,210 c. $ 591,450 d. $ 953,378 Questions 31-40 are four (4) points each. Your employer, Kent, LLC. is considering an investment in an office building that has the following cash flows: Purchase in Year 0............... $ -2,750,000 Year 1.... 180,000 Year 2..... 276,000 Year 3............ 220,000 Year 4..... 239,000 Year 5 250,000, and a sale @ $3,190,000 takes place EOY 5 The company's weighted average cost of capital that they use as their discount rate for such calculations is 8% 40. Using the company's hurdle rate (discount rate) for leveraged projects of 9.00%, what is the leveraged NPV of the project? a. $ 577,943 b. $ 893,210 c. $ 591,450 d. $ 953,378
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