Question
Waste Industries is evaluating a $53,900 project with the following cash flows. Years Cash Flows 1 $ 9,180 2 16,200 3 21,800 4 17,400 5
Waste Industries is evaluating a $53,900 project with the following cash flows. Years Cash Flows 1 $ 9,180 2 16,200 3 21,800 4 17,400 5 30,600 The coefficient of variation for the project is .205. Coefficient of Variation Discount Rate 0 .25 5 % .26 .50 10 % .51 .75 12 % .76 1.00 19 % 1.01 1.25 20 % Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. a. Select the appropriate discount rate. 20% 10% 12% 5% 19% b. Compute the net present value. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.) c. Based on the net present value should the project be undertaken?
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