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Your venture has signed a new consulting contract thal will require you to invest in new analytical software and a new computer. The cost of

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Your venture has signed a new consulting contract thal will require you to invest in new analytical software and a new computer. The cost of this equipment is $200,000. You will finance this investment by borrowing from the bank. You want to make your periodic payments as low as possible. You have to offers from banks. Either The loan will be for 3 years at a rate of 9%. The loan will be amortized over the three years so that at the end of year 3 your loan balance will be $0 or The loan will be for six years at a rate of 10% an again the loan will be fully amortized over the six year period. The loan with the lowest payment is 6 years at 10%. True False Your venture has signed a new consulting contract that will require you to invest in new analytical software and a new computer. The contract will generate the cash flows at specific times. Your cost of capital is 12%. The XNPV of this project is between $2,500 and $2,600. In the XNPV function you can include the initial time and initial cash flow in the Excel formula so no need to net it out as in the NPV formula. Your venture has signed a new consulting contract that will require you to invest in new analytical software and a new computer. The cost of this equipment is $200,000. You will finance this investment by borrowing from the bank. The loan will be for 3 years at a rate of 9%. The loan will be amortized over the three years so that at the end of year 3 your loan balance will be $0. Your periodic loan payment will be between $81,000 and $81,200. True False

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