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

  Public be made aware that insiders are paying lower price

Should insiders (example company owners) of a company be allowed to purchase stock at a lower price that the market price offered? Should the public be made aware that insiders are paying a lower price? How?

  Calculate the retailer selling price

Within a given distribution channel, the following information is available concerning trade margins and costs. A wholesaler has a unit selling price of $27 and a unit cost of $18. The retailer requires a 32% mark up on selling price. The manufacture..

  Inflation risk premiums-bond yields and rates of return

A 10-year, 12% semi annual coupon bond with a par value of $1,000 may be called in 4 years at a call price of $1,060. The bond sells for $1,100. Because of a recession, the inflation rate expected for the coming year is only 3%. However, the inflatio..

  What is the dollar amount of income

A woman purchased a piece of real estate last year for $82,500. The real estate is now worth $102,900. If she needs to have a total return of 0.20 during the year, then what is the dollar amount of income that she needed to have to reach her objectiv..

  What is the firms horizon or continuing and value

Hart Enterprises recently paid a dividend, D0, of $1.75. It expects to have non constant growth of 18% for 2 years followed by a constant rate of 10% thereafter. The firm's required return is 11%. How far away is the horizon date? What is the firm's ..

  Capital structure-maximzes stock price-shareholder value

As with all financial decisions, a firm should try to set a capital structure that maximzes the stock price, or shareholder value. This is called the optimal capital strucutre; it is also the debt-equity mix that: Review the list and indentify which ..

  What should be paid for overland common stock

Which of the following amounts is closest to what should be paid for Overland common stock? Overland has just paid a dividend of $2.25. These dividends are expected to grow at a rate of 5% in the foreseeable future. The required rate of return is 11%..

  What is the expected return on the stock

A stock, currently trading at $50, expects to pay a $4.50 dividend this year. The dividends and stock price has been growing at 8% for 10 years. What is the expected return on the stock this year?

  Cost of providing this coverage to the security firm

A security firm is offered $80,000 in one year for providing CCTV coverage of a property. The cost of providing this coverage to the security firm is $74,000, payable now, and the interest rate is 8.5%. Should the firm take the contract?

  Assume the current or market or prevailing

The Kalodop Corporation issues 12% annual coupon bonds that pay $1,000 at maturity. These bonds mature in 15 yrs. What is the value (PV) or (Vb) of the bonds if the current or market or prevailing or going or YTM is 10%.

  Try to determine the required rate of return

Try to determine the required rate of return on Mary Farm Corp. common stock. The firm's beta is 1.6. The rate on a 10-year treasury bond is 2.38%, and the market return is 8.06%

  What is the economic or npv break-even number of books

KMW Inc. sells finance textbooks for $150 each. The variable cost per book is $30 and the fixed cost per year is $30,000. The process of creating a textbook costs $150,000 and the average book has a life span of three years. What is the economic or N..

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