If the Present Value of all estimated futures costs of a 3 year new investment project...
If the Present Value of all estimated futures costs of a 3 year new investment project is 630, and the future value of all expected profits is 1,900, what is the projects MIRR?
Question 9 (1 point) A company's cost of debt is 0.04, and its cost of retained earnings is 0.10. If the company is financed only with debt and equity and it equity fraction is 1.0, what is the company's WACC?
Homework Answers
1.
MIRR = ( FVc / PVfc )1/n -1
where, FVc is the future value of positive cash flows
and PVfc is the present value of negative cash flows
Given, FVc = $1900
PVfc = $630
Number of Years = n = 3
=> MIRR = (1900/630)1/3 - 1 = 0.4448 or 44.48%
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