Investment net present value and internal rate of return

Assignment Help Financial Management

Reference no: EM131568856

Management of a firm with a cost of capital of 12 percent is considering a $100,000 investment with annual cash flow of $44,524 for three years.

What are the investment’s net present value and internal rate of return?

The internal rate of return assumes that each cash flow is reinvested at the internal rate of return. It that investment rate is achieved, what is the total value of the cash flows at the end of the third year?

The net present value technique assumes that each cash flow is reinvested at the firm’s cost of capital. What would be the total value of the cash flows at the end of the third year, if the funds are reinvested at the firm’s cost of capital?

Reference no: EM131568856

Questions Cloud

Distinguish between the four basic financial statements : Distinguish between the four basic financial statements: income statement, balance sheet, statement of stockholder's equity and cash flow statement.

Rewrite each statements without using the word necessary : Use the facts that the negation of a ? statement is a ? statement and that the negation of an if-then statement is an and statement.

What is happening to market interest rates right now : What is happening to market interest rates right now? Why are they moving in the direction they are?

Write original essay in response to the prompt : Many students who enroll at University are intrigued by its commitment to positive social change. As a member of the community, how do you see yourself

Investment net present value and internal rate of return : What are the investment’s net present value and internal rate of return?

Future of companies balance sheets : How do you see the capital structures and associated pricing change in the future? Debt versus equity, what will be the future of companies' balance sheets?

What is the hedge ratio if the stock goes down one period : What is the hedge ratio if the stock goes down one period?

Discuss heart of darkness : I discuss the common theme of racism between the books, "The Antheap", by Doris Lessing, and "Heart of Darkness" by Joesph Conrad

Identify at least two emerging infectious disease threats : The information presented must identify at least TWO Emerging Infectious Disease Threats found in the country selected: Preferable country KENYA.

User Account

All Pages