Question
You are the head of the project selection team at SIMSOX. Your team is considering three different projects. Based on past history, SIMSOX expects at
You are the head of the project selection team at SIMSOX. Your team is considering three different projects. Based on past history, SIMSOX expects at least a rate of return of 24 percent. Given the following information for each project, which one should be SIMSOXs first priority? Should SIMSOX fund any of the other projects? (Use the NPV function in Excel to solve this problem. Negative amount should be indicated by a minus sign.) Project: Dust Devils
| Year | Investment | Revenue Stream |
| 0 | 560,000 | 0 |
| 1 | 40,000 | |
| 2 | 280,000 | |
| 3 | 380,000 | |
Project: Ospry
| Year | Investment | Revenue Stream |
| 0 | 310,000 | 0 |
| 1 | 34,000 | |
| 2 | 34,000 | |
| 3 | 34,000 | |
| 4 | 77,000 | |
Project: Voyagers
| Year | Investment | Revenue Stream |
| 0 | 87,000 | 0 |
| 1 | 27,000 | |
| 2 | 25,000 | |
| 3 | 62,000 | |
| 4 | 56,000 | |
| 5 | 144,000 | |
NPV for dust devils?
......................Osprys?
.......................Voyagers?
How many projects should be funded?
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Fundamentals Of Futures And Options Markets
Authors: John C. Hull
4th Edition
0130176028, 9780130176028
