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The questions are in the picture. Thank you! A project requires an initial outlay of $50,000,000. The project life is determined to be 5 years
The questions are in the picture. Thank you!
A project requires an initial outlay of $50,000,000. The project life is determined to be 5 years at which time It will be discontinued and sold for scrap at $5,000,000. The project will gonorate net cash In-flows of $20,000,000 every year for the next five years. The projects required rate or discount rat ls 11.25% 6 What is the projects Payback period. 2. 1.25 Years b. 2.5 Years C. 3.5 Years d. 5 Yoars 7 What is the projects NPV. 35,325,210 b. 26,389,491 22,325,306 19,067,302 a. C. 3. 8 What is the projects IRR. 15.07% OK. This is difficult. What you're solving for here is the discount rate b 20.13% that will make NPV zero. You can do this using Excel, or a financial 25.25% calculator. It is very difficult to do long-hand. Don't worry if you can't get it yet, d 30.06% we'll make this a bonus questions. Expect this one on the final exam. 3 A $10,000 zero coupon bond, with eleven (11) years to maturity is selling for $8,876.00 Calculate this bonds yield to maturity. 7.03% b. 6.09% OK, you've seen this one before. Solve for r for a lump sum question. 5.79% 1.09% 10 in capital budgeting, when one project is accepted, and the others being considered can be accepted as well, we call these potential projects mutually exclusive b. mutually independent c. Independently mutual d. independent d Step by Step Solution
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