simone project 6

Project Description:

question 1 (1 point)


quick sale real estate company is planning to invest in a new development. the cost of the project will be $23 million and is expected to generate cash flows of $14,000,000, $11,750,000, and $6,350,000 over the next three years. the company's cost of capital is 20 percent. what is the internal rate of return on this project? (round to the nearest percent.)
question 1 options:

20%

24%

22%

28%
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question 2 (1 point)


muncy, inc., is looking to add a new machine at a cost of $4,133,250. the company expects this equipment will lead to cash flows of $817,322, $863,275, $937,250, $1,019,610, $1,212,960, and $1,225,000 over the next six years. if the appropriate discount rate is 15 percent, what is the npv of this investment?
your answer:
question 2 options:


answer
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question 3 (1 point)


given the following cash flows for a capital project, calculate the irr using a financial calculator
year
0 1 2 3 4 5
cash flows ($50,467) $12,746 $14,426 $21,548 $8,580 $4,959


question 3 options:

8.41%

8.05%

8.79%

7.9%
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question 4 (1 point)


an investment of $83 generates after-tax cash flows of $48.00 in year 1, $66.00 in year 2, and $127.00 in year 3. the required rate of return is 20 percent. the net present value is
your answer:
question 4 options:


answer
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question 5 (1 point)


cortez art gallery is adding to its existing buildings at a cost of $2 million. the gallery expects to bring in additional cash flows of $520,000, $700,000, and $1,000,000 over the next three years. given a required rate of return of 10 percent, what is the npv of this project?
question 5 options:

-$197,446

$1,802,554

$197,446

-$1,802,554
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question 6 (1 point)


which one of the following statements about the payback method is true?
question 6 options:

the payback method is consistent with the goal of shareholder wealth maximization

the payback method represents the number of years it takes a project to recover its initial investment plus a required rate of return.

there is no economic rational that links the payback method to shareholder wealth maximization.

none of these statements are true.
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question 7 (1 point)


mckenna sports authority is getting ready to produce a new line of gold clubs by investing $1.85 million. the investment will result in additional cash flows of $525,000, $837,500, and $1,245,000 over the next three years. what is the payback period for this project?
your answer:
question 7 options:


answer
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question 8 (1 point)


monroe, inc., is evaluating a project. the company uses a 13.8 percent discount rate for this project. cost and cash flows are shown in the table. what is the npv of the project?
year project
0 ($11,368,000)
1 $ 2,187,590
2 $ 3,787,552
3 $ 3,275,650
4 $ 4,115,899
5 $ 4,556,424
your answer:
question 8 options:


answer
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Project Stats:

Price Type: Fixed

Project Budget: $0 to $10
Completed
Total Proposals: 1
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