Calculate the NPV and rate of return for each of the following investments The opportunity cost of capital is 20 percent for all four investments a Which investment is most valuable b Suppose each investment would require use of the same parcel of land Therefore you can take only one Whichone Initi...

a Investment 1 because it has the highest NPV b Investment 1 b ...

Calculate the NPV and rate of return for each of the following investments. The opportunity cost of

Question:

Calculate the NPV and rate of return for each of the following investments. The opportunity cost of capital is 20 percent for all four investments.

Initial Cash Flow, Co Cash Flow in Year 1, C, Investment - 10,000 -5,000 -5,000 -2,000 +18,000 +9,000 +5,700 +4,000 2 3

a. Which investment is most valuable?

b. Suppose each investment would require use of the same parcel of land. Therefore you can take only one. Whichone?

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...