An investment project requires an outlay of $100,000, and is expected to generate annual cash inflows of $28,000 for the next 5 years The cost of capital is 12 percent a Determine a net present value for the project b Determine the internal rate of return for the project (to the nearest tenth of on...

a Calculation of the Net present value NPV Total Present values of cash inflows Investment out lay C ...

An investment project requires an outlay of $100,000, and is expected to generate annual cash inflows of

Question:

An investment project requires an outlay of $100,000, and is expected to generate annual cash inflows of $28,000 for the next 5 years. The is 12 percent.
a. Determine a for the project.
b. Determine the for the project (to the nearest tenth of one percent).

Net Present Value
What is NPV? The net present value is an important tool for capital budgeting decision to assess that an investment in a project is worthwhile or not? The net present value of a project is calculated before taking up the investment decision at... Internal Rate of Return
Internal Rate of Return of IRR is a capital budgeting tool that is used to assess the viability of an investment opportunity. IRR is the true rate of return that a project is capable of generating. It is a metric that tells you about the investment... Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...