Assume the following cash flow steam: Cash flow is $100,000 at the end of year 1,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Assume the following cash flow steam: Cash flow is $100,000 at the end of year 1, $120,000 at end of year 2, $50,000 end of year 3, $300,000 end of year 4, $20,000 end of year 5 and $200,000 end of year 6. a. How much should I pay for the cash flow stream to receive a 20% return on my investment? b. What would the multiple on this investment be? c. What would my ROI be for year 3, based on what I decided to pay for the cash flow stream? 10. If I only paid $300,000 for the cash flow stream in the previous question, a. What would my IRR (internal rate of return) be on my investment? b. What would the multiple on my investment be? c. What would my ROI in year 3 be? d. What would my payback period be? Assume the following cash flow steam: Cash flow is $100,000 at the end of year 1, $120,000 at end of year 2, $50,000 end of year 3, $300,000 end of year 4, $20,000 end of year 5 and $200,000 end of year 6. a. How much should I pay for the cash flow stream to receive a 20% return on my investment? b. What would the multiple on this investment be? c. What would my ROI be for year 3, based on what I decided to pay for the cash flow stream? 10. If I only paid $300,000 for the cash flow stream in the previous question, a. What would my IRR (internal rate of return) be on my investment? b. What would the multiple on my investment be? c. What would my ROI in year 3 be? d. What would my payback period be?
Expert Answer:
Answer rating: 100% (QA)
a To determine how much should be paid for the cash flow stream to receive a 20 return on investment ... View the full answer
Related Book For
Introduction to Operations Research
ISBN: 978-1259162985
10th edition
Authors: Frederick S. Hillier, Gerald J. Lieberman
Posted Date:
Students also viewed these finance questions
-
Ques 1: What is the major complaint by firms concerning the Sarbanes-Oxley act of 2012? A. the legislative maximum allowable compensation for a CEO. B. the legal requirement to disclose project...
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
5. (8 points) (Determining a hidden "dot product vector") Consider the problem where one is given black-box access to a function f: {0, 1}" {0, 1} such that f(x) = a-z, where a {0,1}" is unknown....
-
The market for taxi services in a Midwestern town is monopolized by firm 1. Currently, any taxi services firm must purchase a $40,000 ??medallion?? from the city in order to offer its services. A...
-
Delta Company pays salaries and wages on the last day of each month. Payments made on December 31, 20X1, for amounts incurred during December are shown below. Cumulative amounts paid prior to the...
-
Nonunion production, clerical, and middle management employees of the Intersect Corporation participate in a postretirement benefit plan that encompasses health care, housing subsidies, and tuition...
-
Utease Corporation has many production plants across the midwestern United States. A newly opened plant, the Bellingham plant, produces and sells one product. The plant is treated, for responsibility...
-
Describe the concept of an abstraction layer in an operating system. How does it contribute to OS portability across different hardware architectures ?
-
You are the Owners project manager on an electrical upgrade project. Existing overhead power lines are being buried in a duct bank to hide them from view in an area of the town that is being...
-
b. What is the experimental integration ratio in the H-NMR data that you obtained? Is this ratio consistent with the expected integration ratio of the pure product? c. According to the H-NMR data, is...
-
A pressure vessel of 250-mm inner diameter and 6-mm wall thickness is fabricated from a 1.2- m section of spirally welded pipe AB and is equipped with two rigid end plates. The gage pressure inside...
-
The preliminary survey results just came back on the specialty catalog project, and they look great! The average planned order size was $42.33, well above the $15 that was hoped for. The group leader...
-
2) An opening bridge takes 60 seconds to open. The opening motion is shown on the angular velocity time diagram (Figure 14). Figure 14 Angular Velocity (rad.s) 0.03 0.02 0.01 0 10 20 30 40 40 50 60...
-
What is the meaning of all of these? "Transforming the complex to the simple is pure genius" "Complexity that works is built up out of modules that work perfectly, layered one over the other"
-
Why do we employ perceptual screens to filter the ads to which we are exposed? 2. What does the term consumer behavior refer to, and why is it important to advertisers? What is the difference...
-
Introduce a normal form game that illustrates the Prisoner's Dilemma. Explain the strategies, payoffs and then identify the Nash Equilibrium and explain the paradox the game presents when considering...
-
(a) With not more than 300 words, examine why Malaysia missed its 2020 targets to divert 40% of waste from landfills and increase recycling rates to 22%. (10 marks) b) Why arent Malaysian recycling?...
-
Reconsider the example presented at the end of Sec. 29.8. Suppose now that a third machine, identical to the first two, has been added to the shop. The one maintenance person still must maintain all...
-
Reconsider the example used to illustrate the deterministic periodic-review model in Sec. 18.4. Solve this problem when the demands are increased by 1 airplane in each period.
-
Consider Example 1 (manufacturing speakers for TV sets) introduced in Sec. 18.1 and used in Sec. 18.3 to illustrate the EOQ models. Use the EOQ model with planned shortages to solve this example when...
-
What are the two categories of pattern generality? Explain.
-
Analogy approach makes people end up building templates rather than building patterns. Explain.
-
Explain the concept behind constructing analysis pattern by using stability approach.
Study smarter with the SolutionInn App