Evaluate generation project with the cash flows

Assignment Help Financial Management

Reference no: EM131176704

Howell Petroleum, Inc., is trying to evaluate a generation project with the following cash flows: Year Cash Flow 0 –$43,000,000 1 67,500,000 2 –18,000,000

Required:

(a) If the company requires a 11 percent return on its investments, what is the NPV of the project? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) NPV $ 3,201,607.01

(b) Compute the IRRs for this project. (Do not round intermediate calculations. Enter the positive value in the first answer box, and the negative value in the second answer box. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) Internal rate of return 22.93 % Internal rate of return %

Reference no: EM131176704

Questions Cloud

What is the present value of the break-even point : Luke Athletics Inc. has purchased a $200,000 machine to produce tennis balls. The machine will be fully depreciated by the straight-line method for its economic life of five years and will be worthless after its life. What is the present value of the..

How and where is the drug broken down in the body : How does the drug travel through the body? Where does the drug work in the body? What neurotransmitters are involved?

Different types of customers : Describe Dell's approach for site design and promotion to deliver relevant offers for different types of customers.

What do such plans have to take into account : For an organization on its decision on which products and services to develop, price it develops plans and strategies that outline how they want to go about this process. What do such plans have to take into account?

Evaluate generation project with the cash flows : Howell Petroleum, Inc., is trying to evaluate a generation project with the following cash flows: If the company requires a 11 percent return on its investments, what is the NPV of the project? Compute the IRRs for this project.

Explain your point of view on alliance system including hope : Take the perspective of a European citizen of a nation not considered a world power. Explain your point of view on the alliance system including hopes or fears due to the swift changes.

Current iso standard on risk management : Outline the Purpose and key process elements of the current ISO standard on Risk Management

How modern ethical thinkers hobbes and hume might respond : In your view, was Nelson Mandela justified in the use of violence to resist the apartheid government of South Africa? Reflect on how early modern ethical thinkers Hobbes, Hume, and Kant might respond to this issue.

Calculate the payback period for the machine : The cost of a new machine is $250000 the machine had a 10 years life and no salvage if the cash inflow generated each year as a result of the investment in this new machine is equal to 25% of the cost of the machine calculate the payback period for..

User Account

All Pages