What is net present value of investment using discount rate

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1. A $200,000 investment is expected to provide cash inflows of $100,000 at the end of each of the next six years. What is the net present value of the investment using a discount rate of 12%, rounded to the nearest dollar?

2. In 1991, AT&T laid a transatlantic fiber optic cable costing $400 million that can handle 80,000 calls simultaneously. What is the payback on this investment if AT&T uses just half its capacity while netting one cent per minute on calls?

3. The Franko Company has a beta of 1.09. By what percent will the rate of return on the stock of Franko Company increase if the market rate of return rises by 3%?

Reference no: EM131918141

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