(b) Consider the following three investment projects: A Cash-flow () Project Year 0 -900,000 12345 270,000...

   

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(b) Consider the following three investment projects: A Cash-flow () Project Year 0 -900,000 12345 270,000 2 270,000 270,000 270,000 5 270,000 The relevant cost of capital is 10% B C Cash-flow () Cash flow () -810,000 -1,350,000 270,000 450,000 157,500 360,000 292,500 450,000 315,000 337,500 135,000 427,500 Required: (i) Calculate the payback period for each project. (6) (ii) Calculate the discounted payback period for each project. (7) Calculate the internal rate of return (IRR) on each project (for project B try 11% and 16%; for project C try 12% and 17%). (10) (iv) Calculate the net present value (NPV) of each project. (10) (v) Calculate the profitability index for each project. (3) (vi) Calculate the modified internal rate of return (MIRR) for each project using the reinvestment approach. (9) (50) (b) Consider the following three investment projects: A Cash-flow () Project Year 0 -900,000 12345 270,000 2 270,000 270,000 270,000 5 270,000 The relevant cost of capital is 10% B C Cash-flow () Cash flow () -810,000 -1,350,000 270,000 450,000 157,500 360,000 292,500 450,000 315,000 337,500 135,000 427,500 Required: (i) Calculate the payback period for each project. (6) (ii) Calculate the discounted payback period for each project. (7) Calculate the internal rate of return (IRR) on each project (for project B try 11% and 16%; for project C try 12% and 17%). (10) (iv) Calculate the net present value (NPV) of each project. (10) (v) Calculate the profitability index for each project. (3) (vi) Calculate the modified internal rate of return (MIRR) for each project using the reinvestment approach. (9) (50)