Question
You are considering investing in a start up company. The founder asked you for $ 250,000 today and you expect to get $1,010,000 in 14
You are considering investing in a start up company. The founder asked you for $ 250,000 today and you expect to get $1,010,000 in 14
years. Given the riskiness of the investmentopportunity, your cost of capital is 22%. What is the NPV of the investmentopportunity? Should you undertake the investmentopportunity? 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 investmentopportunity?
The NPV of the investment is $?
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Principles Of Corporate Finance
Authors: Lawrence J. Gitman, Sean M. Hennessey
2nd Canadian Edition
0321452933, 978-0321452931
