Two parts 1 question

1)

Your firm is evaluating a capital budgeting project. The estimated cash flows appear below. The board of directors wants to know the expected impact on shareholder wealth. Knowing that the estimated impact on shareholder wealth equates to net present value (NPV), you use your handy calculator to compute the value. What is the project's NPV? Assume that the cash flows occur at the end of each year. The discount rate (i.e., required rate of return , hurdle rate) is 16.1%. (Round to nearest penny)

Year cash 0 flow -127,000

Year 1 cash flow 46,000

Year 2 cash flow 30,000

Year 3 cash flow 56,000

Year 4 cash flow 59,000

Year 5 cash flow 19,000

Answer:

Your firm is evaluating a capital budgeting project. The estimated cash flows appear below. The board of directors wants to know the expected impact on shareholder wealthKnowing that the estimated impact on shareholder wealth equates to net present value (NPV), you use your handy calculator to compute the valueWhat is the project's NPVAssume that the cash flows occur at the end of each yearThe discount rate (required rate of return, hurdle rate) is 15.8%. (Round to nearest penny)

Year cash 0 flow -116,000

Year 1 cash flow 44,000

Year 2 cash flow 36,000

Year 3 cash flow42,000

Year 4 cash flow 54,000

Year 5 cash flow 33,000

Answer: