An investment project has annual cash inflows

Assignment Help Financial Management
Reference no: EM13882034

An investment project has annual cash inflows of $3,800, $4,700, $5,900, and $5,100, for the next four years, respectively. The discount rate is 14 percent.

What is the discounted payback period for these cash flows if the initial cost is $8,600?

What is the discounted payback period for these cash flows if the initial cost is $11,600?

Reference no: EM13882034

Questions Cloud

What is the role of accountants in ensuring : What is the role of accountants in ensuring that there are sufficient controls to safeguard the production cycle?
Determine the heat- transfer area : If a double-effect evaporator system is used with forward feed and U = 450 Btu/h-ft2-°F and 112 = 350 Btu/h-ft2-°F, and a vapor- space pressure of 4 in. Hg in the second effect determine the heat- transfer area of each effect, assuming equal areas..
Compounded annually to reach your goal : Suppose you want to have $2,000 saved in 4 years. How much do you need to deposit now in an account that earns 4% compounded annually to reach your goal?
Beta of equity and beta of assets : Big Bass Sound (BBS) is a thriving music business. You would like to understand the market risk of BBS and are looking to find its Beta of the Assets. BBS' Beta of Equity is 3, the beta of debt is 0.3, and the tax rate is 32%. BBS has 169 in debt out..
An investment project has annual cash inflows : An investment project has annual cash inflows of $3,800, $4,700, $5,900, and $5,100, for the next four years, respectively. The discount rate is 14 percent. What is the discounted payback period for these cash flows if the initial cost is $8,600?
About the beta of assets : Katy's Kitten Emporium (KKE) is a thriving pet store business. You would like to understand the market risk of the KKE and are looking to find its Beta of the Assets. KKE's Beta of Equity is 1.7, the beta of debt is 0.2, and the tax rate is 29%. If K..
Determine which copier the company should acquire : The company uses a 3-year planning period and a MARR of 15% per year. Determine which copier the company should acquire on the basis of an incremental rate of return analysis.
What is expected return on portfolio that equally invested : A stock has a beta of 1.15 and an expected return of 13 percent. A risk-free asset currently earns 2.8 percent. a. What is the expected return on a portfolio that is equally invested in the two assets? If a portfolio of the two assets has a beta of ...
What specific risks does each supplier option present : What issues should Magness evaluate in his assessment of transportation risks? Analyze each supplier option that Magness is considering. What specific risks does each supplier option present

Reviews

Write a Review

Financial Management Questions & Answers

  Assuming the dividend and capital gain

A stock currently costs $ 85 and pays a $ 3.50 dividend. If you expect to sell the stock after 10 years for $ 125 what is your anticipated return on the investment. (The answer is the average return for the 10 years assuming the dividend and capital ..

  What is the firms current estimated intrinsic stock price

Your employer, a mid-sized human resources management company, is considering expansion into related fields, including the acquisition of Temp Force Co. an employment agency that supplies word processor operators and computer programmers to business ..

  What will be the systems money supply

Assume a financial system has a monetary base of $25 million. The required reserves ratio is 10 percent and there are no leakages in the system. What is the size of the money multiplier? What will be the system’s money supply?

  About the credit card bill

CJanet just got her credit card bill. The bill is for a 30 day billing period. The bill indicated that she started with a $900 balance, on day 14 charged $200, on day 20 charged $99, on day 26 paid $500. There was no other activity on the account dur..

  Compute the required return of the portfolio

You invest in a portfolio of 5 stocks with an equal investment in each one. The betas of the 5 stocks are as follows: .75, -1.2, .90, 1.3, 1.5. The risk free return is 4% and the market return is 9%. (Not a multiple choice problem) Compute the beta o..

  Portfolio consists-treasury bills-risk level equivalent

Your portfolio has a beta of 1.24. The portfolio consists of 13 percent U.S. Treasury bills, 28 percent stock A, and 59 percent stock B. Stock A has a risk level equivalent to that of the overall market. What is the beta of stock B? Provide detailed ..

  What is the initial expected NPV with this plan

Suppose a 25mm new venture has a 50% chance of success or failure. Success is 10mm per year perpetual earnings and failure is 8mm per year perpetual losses. The discount rate is 10%. What is the NPV for each scenario? What is the simple expected NPV?..

  Maintain targets for modified duration at convexity

Assume that a portfolio of corporate bonds is managed to maintain targets for modified duration at convexity. Explain how the portfolio could include both callable and non callable bonds while maintaining the targets. Describe one advantage and one d..

  Cash flows over the four-year life of the investment

An investment has an installed cost of $532, 800. The cash flows over the four-year life of the investment are projected to be $216,850, $233,450, $200,110, and $148, 820.

  Bond using both semi-annual and annual discounting

What is the value of the bond using both semi-annual and annual discounting

  Prepare contribution format income statement for the year

Chuck Wagon Grills, Inc., makes a single product—a handmade specialty barbecue grill that it sells for $200. What is the company’s break-even point in terms of the number of barbecue grills sold? Assume that the company uses variable costing. Compute..

  Statements concerning junk bonds

Which of the following statements concerning junk bonds is most correct?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd