Question
You are considering investing in a start up company. The founder asked you for $ 220 comma 000 $220,000 today and you expect to get$
You are considering investing in a start up company. The founder asked you for $ 220 comma 000
$220,000 today and you expect to get$ 990 comma 000
$990,000 in 10
10 years. Given the riskiness of the investment opportunity, your cost of capital is 28 %
28%. What is the NPV of the investment opportunity? Should you undertake the investment opportunity? Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged.
What is the NPV of the investment opportunity?
The NPV of the investment is $
nothing
. (Round to the nearest dollar.)
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Applied Equity Analysis and Portfolio Management Tools to Analyze and Manage Your Stock Portfolio
Authors: Robert A.Weigand
1st edition
978-111863091, 1118630912, 978-1118630914
