Offered the opportunity to invest in a project

Assignment Help Financial Management
Reference no: EM131063188

You have been offered the opportunity to invest in a project that will pay $4,672 per year at the end of years one through three and $7,543 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 11.39 percent per year. What is the future value of this cash flow pattern at the end of year five?

Reference no: EM131063188

Questions Cloud

Expected salvage value-how cash flows are changing : Tyler Company purchased a machine 3 years ago at a cost of $150,000. It had an expected life of 10 years at the time of purchase and an expected salvage value of $5,000. The firm has an Actual Collection Period of 63 days and pays its bills after 25 ..
What is the current price of the bond : Assume that a bond makes 10 equal annual payments of $1,000 starting one year from today. The bond will make an additional payment of $100,000 at the end of the last year, year 10. If the discount rate is 3.5$% per annum, what is the current price of..
Recognize that this cash flow stream is an annuity : Assume that a bond makes 30 equal annual payments of $1,000 starting one year from today. (This security is sometimes referred to as an amortizing bond.) If the discount rate is 3.5% per annum, what is the current price of the bond? (Hint: Recognize ..
What are two benefits of first forecasting sales : What are two benefits of first forecasting sales before immersing the company in a detailed master budget process? [Think about where you are with what resources you have now, versus where you want to go that may possibly need more or different resou..
Offered the opportunity to invest in a project : You have been offered the opportunity to invest in a project that will pay $4,672 per year at the end of years one through three and $7,543 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 11.3..
Activities organization can engage in to accomplish goals : Suppose firm XYZ has AR (Accounts Receivable) = 500, Sales = 3000, Inventory = 300, Cost of Goods Sold = 1200, and AP (Accounts Payable) = 100. How much cash does firm XYZ save if it reduces its Days Sales Outstanding by 10 days? What are specific ac..
Describes the decision to cut wood now versus next year : Let V0 = the value of wood harvested this year; V1 = the value of wood harvested next year; DV = V1 - V0; C = harvest costs; r = the discount rate; S = the present value of all future net benefits when forest is harvested respecting an optimal rotati..
Just-in-time inventory : Conduct research to find a company that is successfully using JIT systems in its operations.  Describe the company briefly – product/services, locations, customers. Describe the company’s operations briefly – type of process
Calculate the weights on the minimum variance portfolio : Assessment 2 aims to provide students with an opportunity to analyze various investment alternatives based on the respective risk and return so as to choose the most appropriate investment opportunity.  Calculate the weights on the optimal risky port..

Reviews

Write a Review

Financial Management Questions & Answers

  Determine the payback period-npv and irr for both project

Determine the Payback period, NPV and IRR for both project A and B (show work). Which Project would you select and why? Be specific. Project A will require an initial investment of $ 200,000 and Project B will require and initial investment of $ 325,..

  Calculate value of operations

Mac Industries' free cash flow last year was $ 1million (i.e., FCFo = $1 million). You project the company's free cash flow to grow 20 percent this year (i.e., FCF1 = $1.2 million) and 15 percent next year. After two years its free cash flow is expec..

  Calculate the average rate of return for each stock

Historical Realized Rates of Return You are considering an investment in either individual stocks or a portfolio of stocks. The two stocks you are researching, Stocks A and B have the following historical returns: Calculate the average rate of return..

  You have established that a project portfolio is a group of

you have established that a project portfolio is a group of projects to be carried out under the sponsorship of a

  How much of that contribution is tax deductible

Gene and Dixie, husband and wife (ages 45 and 42), both work. They have an adjusted gross income of $50,000 in 2012, and they are filing a joint income tax return. Both have an employer-provided retirement plan at work. What is the maximum IRA contri..

  Fama-french three-factor model

An analyst has modeled the stock of a company using a Fama-French three-factor model. The risk-free rate is 4%, the market return is 10%, the return on the SMB portfolio (rSMB) is 3.6%, and the return on the HML portfolio (rHML) is 5.4%. If ai = 0, b..

  Finance the expansion of operations

Finance the expansion of operations, and financial institutions issue them to raise funds for lending to households and corporations - major events that affect the risk of these securities and that of my prior statements

  What is the firms market value capital structure

Titan Mining Corporation has 9.6 million shares of common stock outstanding and 400,000 6 percent semiannual bonds outstanding, par value $1,000 each. What is the firm's market value capital structure? If Titan Mining is evaluating a new investment p..

  Transaction deposits on its balance sheet

Patriotic Bank currently has $800 million in transaction deposits on its balance sheet. The current reserve requirement is 10 percent, but the Federal Reserve is decreasing this requirement to 8 percent. Present the balance sheet (before and after ch..

  Calculate the equivalent annual cash flows the project

Allied Products, Inc., is considering a new product launch. The firm expects to have annual operating cash flow of $9.5 million for the next eight years. After the first year, the project can be dismantled and sold for $26.5 million. If the estimates..

  Probability range of returns for any one given year

A stock has returns of 18 percent, 15 percent, -21 percent, and 6 percent for the past four years. Based on this information, what is the 95 percent probability range of returns for any one given year?

  Holding period returns of each of the three bonds

Bonds A, B, C and D are zero-coupon bonds with par value $1,000 each and yields to maturity of 6 percent, 8 percent, 10 percent and 12 percent respectively. Bond A matures in one year, bond B in two, bond C in three and bond D in four years. write ex..

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