Net Present Value, Mathematics

Assignment Help:
A business has the opportunity to expand by purchasing a machine at a cost of £80,000.
The machine has an estimated life of 5 years and is projected to generate a cashflow of £20,000 each year end, with no scrap value.
Given the current level of interest rates an appropriate discount rate is regarded to be 7%.
(a) Calculate the NPV of this project.
(b) Calculate an approximate Internal Rate of Return for this investment (to the nearest 1%).
(c) Given a discount rate of 7% at what level of annual cashflow would this project become unviable?

Related Discussions:- Net Present Value

Binimial, theory behind the greatest term in the binomial expansion

theory behind the greatest term in the binomial expansion

Basic indefinite integrals- computing indefinite integrals, Basic indefinit...

Basic indefinite integrals The first integral which we'll look at is the integral of a power of x.                                ∫x n dx = (x n +1 / n + 1)+ c,          n

Convergence, Assume that (xn) is a sequence of real numbers and that a, b €...

Assume that (xn) is a sequence of real numbers and that a, b € R with a is not eaqual to 0. (a) If (x n ) converges to x, show that (|ax n + b|) converges to |ax + b|. (b) Give

Explain the decimal system in detail, Explain The Decimal System in detail?...

Explain The Decimal System in detail? A decimal, such as 1.23, is made up of two parts: a whole number and a decimal fraction. In 1.23, the whole number is 1 and the decimal fr

.fractions, what is the difference between North America''s part of the tot...

what is the difference between North America''s part of the total population and Africa''s part

Compounding and Simple Interest, A painting was purchased 11 years ago for ...

A painting was purchased 11 years ago for $26900. It has just been sold for $78000. Calculate the flat rate of appreciation p.a.

Tests for an ideal index number, Tests for an Ideal Index Number 1. F...

Tests for an Ideal Index Number 1. Factor Reversal Test Factor Reversal Test indicates that when the price index is multiplied along with a quantity index that is factors

Progressions, The sum of the series 1+1/2+1/4+......is

The sum of the series 1+1/2+1/4+......is

Write Your Message!

Captcha
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