HomeworkLib
Question

Create a cash flow for a simple investment project with a 4-year life that produces a...

Create a cash flow for a simple investment project with a 4-year life that produces a discounted payback of 3 years and an IRR of 8%/year if the MARR is 4%. Please show work not just an excel calculation

business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Answed Page No : 1 $ - 1,10,278 22 $ $ 22,500.do Yeax Initial Investiment Yearly charger Revenue $ - 40,000.00 - 60,000 00$-3

0 0
Add a comment
Know the answer?
Add Answer to:
Create a cash flow for a simple investment project with a 4-year life that produces a...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • 3. (5 pts) Create a cash flow for a simple investment project with a 4-year life...

    3. (5 pts) Create a cash flow for a simple investment project with a 4-year life that produces a discounted payback of 3 years and an IRR of 8%/year if the MARR is 4%.

  • Consider the investment project in the table below with four-year investment life n Project Cash Flow...

    Consider the investment project in the table below with four-year investment life n Project Cash Flow ($) 0 -$ 3,500 1 $ 1,600 2 $ 2,800 3 $ 3,500 4 $ 2,200 What is the payback period? (5 points) (show all your work). What is the discounted payback period if the firm’s interest rate is 15% after taxes? (9 points) (show all your work).

  • J&E Enterprises is considering and investment which produces no cash flows for the first year. In...

    J&E Enterprises is considering and investment which produces no cash flows for the first year. In the second year, the cash inflow is $47,000. This inflow will increase to $198,000 and then $226,000 for the following two years, respectively, before ceasing permanently. The initial investment will cost $318,000. The firm requires a 15.5 percent rate of return and has a required discounted payback period of three years. Should the project be accepted? Why or why not? show all work Year...

  • Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$...

    Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$ 350,000 –$ 50,000 1 45,000 24,000 2 65,000 22,000 3 65,000 19,500 4 440,000 14,600 Whichever project you choose, if any, you require a 15% return on your investment. a-1. What is the payback period for each project? (Round the final answers to 2 decimal places.) Payback Period Project A years Project B years a-2. If you apply the payback criterion, which investment will...

  • Suppose your firm is considering investing in a project with the cash flow shown below, that...

    Suppose your firm is considering investing in a project with the cash flow shown below, that the required rate of return on projects of this risk class is 11%, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively Time 0 1 2 3 4 5 Cash flow -$235,000 $65,800 $84,000 $141,000 $122,000 $81,200 . Use the discounted payback decision rule to evaluate this project; should it be accepted or rejected?...

  • Consider the following two mutually exclusive projects: Cash Flow Year 0 Cash Flow (B) - $...

    Consider the following two mutually exclusive projects: Cash Flow Year 0 Cash Flow (B) - $ 50,000 24,000 22,000 19,500 14, 600 - $ 350,000 45,000 65,000 65,000 440,000 AM + Whichever project you choose, if any, you require a 15% return on your investment. a-1. What is the payback period for each project? (Round the final answers to 2 decimal places.) Payback Period Project A Project B years years a-2. If you apply the payback criterion, which investment will...

  • Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$194,527...

    Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$194,527 –$15,905 1 27,700 5,627 2 52,000 8,470 3 52,000 13,908 4 413,000 8,564 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A? b. What is the payback period for Project B? c. What is the discounted payback period for Project A? d. What is the discounted payback period for...

  • Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) $195,640 26,500...

    Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) $195,640 26,500 52,000 51,000 390,000 -$16,290 5,293 8,843 13,587 9,577 0 2 3 4 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?b. What is the payback period for Project B? c. What is the discounted payback period for Project A?d. What is the discounted payback period for Project B? e....

  • Given the following attributes of an investment project with a five-year life: investment outlay, year 0,...

    Given the following attributes of an investment project with a five-year life: investment outlay, year 0, $8,700; after-tax cash inflows, year 1, $930; year 2, $1,070; year 3, $3,200; year 4, $3,500; and year 5, $4,900. (a) Use the built-in NPV function of Excel to estimate the NPV of this project. Assume an after-tax discount rate of 11.0% (b) Estimate the payback period, in years, for this project under the assumption that cash inflows occur evenly throughout the year. (Round...

  • Consider the following two mutually exclusive projects: Year. Cash Flow (A) Cash Flow (B). 02 -$264,129...

    Consider the following two mutually exclusive projects: Year. Cash Flow (A) Cash Flow (B). 02 -$264,129 -$16,027 12 26,500 5,769 2- 53,000 8,571 56,000 13,198 4 423,000 9,431 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?- b. What is the payback period for Project B? c. What is the discounted payback period for Project A? d. What is the discounted payback period for Project...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT