Determine the net present value of the cash flow

Reference no: EM13202334

A company has the following net cash flow:
Year Net Cash Flow ($)
0 -100,000
1 40,000
2 45,000
3 50,000
4 -15,000
5 27,000
6 34,250
7 30,000
Determine the Net Present Value of the cash flow at annual interest rates of 15%, 20%, and 30%. At what (interpolated) rate would the NPV become zero? What is such a rate called? Also, calculate the payback periods, both simple and discounted at 15% per year.

Reference no: EM13202334

Questions Cloud

How many students applied to both schools : In a group of 40 students, 25 applied to Columbia and 30 applied to Cornell. If 3 students applied to neither Columbia nor Cornell, how many students applied to both schools?

What cpted strategies would you use for typical high school : What CPTED strategies would you use for a typical high school? Consider the area around the building(s) as well. Be sure to refer to the CPTED principles stated in the lecture notes.

Determine the interest rate compounded semiannually : every 6 months until he retires so that, beginning one year after his retirement, he will receive $30,000 for the next 15 years. Find the value of (A) which he should deposit every 6 months. Assume the interest rate is 8% compounded semiannually.

What is the implied coupon : If the promised payment on the bond is the same as the issue price of $100, what is the implied coupon if effective interest rates are 3.0% and the bond has a 1-year maturity?

Determine the net present value of the cash flow : Determine the Net Present Value of the cash flow at annual interest rates of 15%, 20%, and 30%. At what (interpolated) rate would the NPV become zero What is such a rate called Also, calculate the payback periods

What will be the net future worth at the end of year : What will be the net future worth at the end of year 12 of the following income and expenses at an interest rate of 10% per year: Year Income, $ Expenses, $ 0 15,000 11,000 6 - 12 8,000 4,000 1 - 5 9,000 5,000

Construct cash flow diagrams : At an 8% annual interest rate, what is the present value of the cash flows? To receive full credit you must use 2 arithmetic gradients. Construct cash flow diagrams and show all your work.

What is the role of advertising in each of the four market : Brand names can be important to the success of a firm in some industries. Consider industries that demonstrate monopoly, monopolistic competition, oligopoly, and perfect competition. What is the goal of creating a brand name for each of these mark..

Does a monopolistic competitor produce more output : Does a monopolistic competitor produce more or less output as compared to an efficient level of production Explain. What are the benefits and drawbacks of this Should the government intervene to alter this

User Account

All Pages