Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Dec 02, 2022

You have an opportunity to invest $101,000 now in return for $80,100 in one year and $30,300 in two years. If your cost of capital

You have an opportunity to invest $101,000 now in return for $80,100 in one year and $30,300 in two years. If your cost of capital is 9.3% , what is the NPV of this investment?

Step by Step Solution

★★★★★

3.41 Rating (148 Votes )

There are 3 Steps involved in it

Step: 1

Answer Explanation Step 1 i Net present value is the present value of cash ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Corporate Finance

Authors: Berk, DeMarzo, Harford

2nd edition

132148234, 978-0132148238

More Books

Students also viewed these Accounting questions

Question

★★★★★

You have an opportunity to invest $50,000 now in return for $60,000 in one year. If your cost of capital is 8%, what is the NPV of this investment?

Answered: 1 week ago

Question

★★★★★

You have an opportunity to invest in a new car manufacturing plant for $5M. Expectations as of today: Annual cash flow in year 1: $600,000 Perpetual growth rate: 2% per year Cost of capital: 12% ...

Answered: 1 week ago

Question

★★★★★

You have an opportunity to purchase a private competitor called Fernand in Mexico. You will use only your funds if you decide to purchase the company. a. When you attempt to determine the value of...

Answered: 1 week ago

Question

★★★★★

If you were advising a legal team on how to prepare for a discovery conference, what would you recommend or include? What issues should a legal team and its client consider? What are some of the...

Answered: 1 week ago

Question

★★★★★

Your partner drafted the following auditors report yesterday. You need to describe the reporting deficiencies, explain the reasons for them, and discuss with the partner how the report should be...

Answered: 1 week ago

Question

★★★★★

Many banks sell most of the mortgage loans that they originate within a few years. Assuming that a bank is not worried about default risk, why would it want to sell the mortgage loans it makes rather...

Answered: 1 week ago

Question

★★★★★

Why should a confidence interval for the parameter being tested be reported along with the results of the hypothesis test?

Answered: 1 week ago

Question

★★★★★

Whitney Plumb Associates surveys American eating habits. The company's accounts include Land, Buildings, Office Equipment, and Communication Equipment, with a separate Accumulated Depreciation...

Answered: 1 week ago

Question

★★★★★

the machines as follows: \ table [ [ Expected Net Cash Flows ] , [ Year , Project A , Project B ] , [ 0 , ( $ 5 0 , 0 0 0 ) , ( $ 5 0 , 0 0 0 )

Answered: 1 week ago

Question

★★★★★

Compare and contrast the leadership styles exhibited by Steve Jobs and Tim Cook.

Answered: 1 week ago

Question

★★★★★

0.5 -0.5 0.5 -0.5 Let A = Note that the columns of A are orthonormal (why?). 0.5 0.5 0.5 0.5 (a) Solve the least squares problem Ax = b where b = * = (b) Find the projection matrix P that projects...

Answered: 1 week ago

Question

★★★★★

A carpet cleaning firm uses an average of 20 gallons of cleaning fluid a day. Usage tends to be normally distributed with a standard deviation of 2 gallons per day. Lead time is 4 days, and the...

Answered: 1 week ago

Question

★★★★★

For the data in Table 12.1, confirm that the Pearson statistic in equation (12.3) is 41.98 . Table 12.1 (12.3) Count Observed (j) (nj) Fitted Counts Using the Poisson Distribution (np;) 01234 6,996...

Answered: 1 week ago

Question

★★★★★

If demand for an item is 10 per month, the cost of placing an order is $$15$, and the cost of holding one item in inventory for 1 year is $$25$, what is the EOQ?

Answered: 1 week ago

Question

★★★★★

Calculate the power delivered by the turbine per unit mass of airflow when the heat transfer in the heat exchanger is zero. Then, how does the power depend on the heat transfer through the exchanger...

Answered: 1 week ago

Question

★★★★★

Using the information in the following table, calculate the marginal revenue product (MRP = MPP MR). Unit of Resources Total Resource Output Price Price 1 10 $5 $10 2 25 $5 $10 345 35 $5 $10 40 $5...

Answered: 1 week ago

Question

★★★★★

The project scope statement indicates that the client is responsible for training the people who will be using the equipment and that the project team will train the client's trainers. This is an...

Answered: 1 week ago

Question

★★★★★

The following items were displayed in the statement of affairs for Lubbock Company: Fully secured liabilities ......... $90,000 Partially secured liabilities ....... 12,000 Unsecured liabilities...

Answered: 1 week ago

Question

★★★★★

The following quote on Yahoo! stock appeared on April 13, 2010, on Yahoo! Finance: If you wanted to buy Yahoo!, what price would you pay per share? How much would you receive per share if you wanted...

Answered: 1 week ago

Question

★★★★★

ABC Corporation announced that it would pay a dividend to all shareholders of record as of Monday, April 5, 2010. It takes three business days after a purchase for the new owners of a share of stock...

Answered: 1 week ago

Question

★★★★★

You purchased a machine for $1 million three years ago and have been applying straight-line depreciation to zero for a seven-year life. Your tax rate is 35%. If you sell the machine right now (after...

Answered: 1 week ago

Question

★★★★★

Suppose that you open 16 soft-drink bottles and find that the contents average 11.6 ounces, with a sample variance of 1.0. What can you say about the statement contents 12 oz. which is on each...

Answered: 1 week ago

Question

★★★★★

A random sample of ten independent observations from a normal distribu tion produced the following values: 51, 50, 49, 43, 56, 46, 45, 30, 55, 52. If a = .20, test the hypothesis that the mean is 50...

Answered: 1 week ago

Question

★★★★★

Suppose that a statistician wants to test the hypothesis that the mean of a normally distributed population is .536 against the alternative that the mean is not equal to .536. He decides to use a =...

Answered: 1 week ago

Previous Question Next Question