Calculate the npv and irr of each

Assignment Help Financial Management
Reference no: EM131556890

Alpha is considering Project A and Project B both with cost of capital 6%. A: -$10,000, $3,500, $3,500, $3,500, $3,500 . B: -$2,000, $743, $743, $743, $743 Calculate the NPV and IRR of each. Are they acceptable? Sketch the NPV profiles on the same axes. The projects are mutually exclusinve. Which is better? Explain in both NPV and IRR terms.

Reference no: EM131556890

Questions Cloud

The end-of-year book values for this equipment : Calculate the annual depreciation allowances and the end-of-year book values for this equipment. If the equipment is sold for 30% of the initial cost in year 3,
What was the purchase price of the furniture : INSTALLMENT FINANCING Peggy made a down payment of $400 toward the purchase of new furniture. To pay the balance of the purchase price, she has secured a loan.
Evaluate the results of the rodney king case : The assault on Rodney King by Los Angeles Police officers in 1991 raised many issues about the actions of officers and subsequent accountability.
What monthly payment will the turners be required to make : HOME FINANCING The Turners have purchased a house for $150,000. They made an initial down payment of $30,000 and secured a mortgage with interest charged.
Calculate the npv and irr of each : Calculate the NPV and IRR of each. Are they acceptable?
Which currency is expected to appreciate in value : Which currency is expected to appreciate in value? Which country do you think has higher interest rates-the United States or Canada? Explain.
What will be their total interest payment : HOME FINANCING If the loan is amortized over 15 yr: What monthly payment will the Turners be required to make?
The irr is greater than the cost of capital : Should Gamma take the project, because the IRR is greater than the cost of capital? Explain
What are some techniques you plan to utilize : What are some techniques you plan to utilize to help you stay focused on your studies during the summer

Reviews

Write a Review

Financial Management Questions & Answers

  Increased by advertising adjusting entry-cash from operation

At the end of the quarter, a company did an adjusting entry to record the fact that $1,000 of Prepaid Advertising had been used up during the quarter. Which of the following items would be increased by this advertising adjusting entry? Cash from Oper..

  Is the transporter a positive-NPV investment

Ted has bought a horse transporter for hi horse ranch for $35,000. The reason is he used to rent transporters to take his horses to competitions and wants to save money on those rental costs. Ted has been renting a transporter every other week (26 ti..

  How much would you be willing to pay for the investment

How much would you be willing to pay for this investment if you required a 12 percent rate of return? If the payments were received at the beginning of each year, what would you be willing to pay for this investment?

  Draw jackies budget constraints in given cases

Draw Jackie's budget constraints in each of these two cases. - Draw representative indifference curves that would reflect each of these scenarios: - Jackie prefers program A to program B.

  Dollar-denominated cash flows consist of initial investment

International Machinery Company (IMC) is a Swedish multinational manufacturing company. Currently, IMC's financial planners are considering undertaking a 1-year project in the United States. The project's expected dollar-denominated cash flows consis..

  Premises lease and printing press lease

For both the premises lease and the printing press leases, explain how the leases will be classified for accounting purposes, and why. Show the journal entries required at the initiation of the lease. Show how the premises and printing press leases w..

  Which program allow gnuti citizen to smooth consumption

Which program is likely to better allow Gnuti citizens to smooth consumption? -Which program is likely to cost the Gnuti government less?

  Growth options tend to cause firm actual capital budget

Would a failure to recognize growth options tend to cause a firm's actual capital budget to be above or below the optimal level? Would your answer be the same for abandonment, timing and flexibility options? Explain using a practical/hypothetical exa..

  The akron effect refers to

Suppose the spot rate of exchange between Germany and the U.S. is euro 0.91/$, with an expected future spot rate of euro 0.95/$. Expected inflation in Germany is 2%, while U.S. expected inflation is 3%. In this situation, traders expect the _________..

  What are the arithmetic and geometric returns

What are the arithmetic and geometric returns for the stock?

  What is company expected growth in dividends

What would be the company’s current indicated dividend? What is the company’s expected growth in dividends?

  Determine the price of a strike european put

Assume the Black-Scholes framework for a futures exchange on F. Determine the price of a strike 80 European put that expires in nine months.

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