Determine the net present value

Reference no: EM131125189

An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine the net present value of the investment if the required rate of return is 14 percent. Should the investment be undertaken?

-Yes, the profit is $25,000.

-No, the accounting return is less than 14%.

-No, the net present value is negative at $11,045.

-Yes, the net present value is positive at $1,496. 50.

Reference no: EM131125189

Questions Cloud

Analyze the broad range of talent management efforts : Discuss aspects of career planning that the organization can use to retain highly talented staff. Use examples of organizations that have career planning systems such as succession planning, education assistance etc. as part of their strategic hum..

Divisional income statements : The following data were summarized from the accounting records for Jersey Coast Construction Company for the year ended June 30, 2016:

Find p1 and p2 if r= 40kn and p3 = 20kn : he force R is the resultant of the forces P1. P2, and P3 acting on the rectangular plate. Find P1 and P2 if R= 40kN and P3 = 20kN.

What are the basic building blocks of life : What are the basic building blocks of life that are indestructible and are certain elements, the smallest part of a molecule

Determine the net present value : An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine the net present value of the investment if the required rate of return is 14 percent. Should the investment be undertaken?

Determine the angular velocity and angular acceleration : Determine the angular velocity and angular acceleration of rod AC at this instant.

Determine the relative influence of heredity and environment : As you complete this exercise, consider the following: How do nature, nurture and evolution affect the development of an individual? How do we determine the relative influence of heredity and environment

What types of ad use informative- persuasive and comparative : Which of Maslow's needs are exemplified in each ad? What types of ad are used: informative, persuasive, comparative? How effective are they? See Chapter 8's "Measuring Media's Advertising Effectiveness" in Consumer Behavior for insight.

The desired number of units in ending inventory : Which of the following is not used in deciding how many units to produce in a period? -The desired number of units in ending inventory.

User Account

All Pages