Firm is considering a project wth th following cash flows. What is the payback period?
Question #6
yr CF blanace
0 -5000 -5000
11000 -4000
22000 -2000
34000 2000
41500
simple payback 2.5
A project needs an investment of $1000 in year 0. It is expected to produce cash flows of $400 in each of the next 5 years (yr 1-5). What is the average annual expected rate of return of the project?
Question#5
Investment -1000
y1 400
y2 400
y3 400
y4 400
y5 400
IRR 28.65%
Invester owns 100 out of the 2000 shares of a firm. The firm announces a project today (yr 0) which everyone agrees has a net present value in year 0 of $1200. The investment in the project, $400, will be made one year from now (year 1)
Question #3
Question #4
in year 0
Question #2
