Question

History Bookmarks Window Help File Edit View anewconnect.mheducation.com DeVry University Week 5: Quiz DeVry Student Portal Saved Week 5: Quiz For the given cash flows, suppose the firm uses the NPV decision rule. 3 Cash Flow Year 150,000 -$ 1 2 66,000 73,000 57,000 a. At a required return of 10 percent, what is the NPV of the project? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. At a required return of 20 percent, what is the NPV of the project? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. NPV b. NPV Next> c 3 of 4 <Prev raw ill Becation 29 MacBook Pro

Answer 1

WWW ULU a) Nov calculation if Required neturn is lopencent : calculation of Pv of cash Inflows! yo cash Inflows PVF@ 10%. Profcernah 0.9091 ۔ 66,000 73,000 0.82 64 م 0.7513 5 7,000 ا 1,63,152 NPV = prof cash Inflows - pv of cash out flows = 163,152 - 150,000 = 13,152 NPV calculation if RR is ao percent i calcolation of pv of cash Inflows : yo cash in flows Puf@20%. Prof cashflows i 6600o 0.8334 2 73000 0.6945 3 57,000 0.5788 1,38,694 cash outflows Npv=pu of cash Inflows - pr of = 138,694 - ļ 50,000 = (11,306) Npvis negative