Jim Jones is purchasing some oil wells, the initial investment of $30 million; the wells should generate profits of $10million a year for the next 5 years. The project has a beta =1.4, the risk-free rate is 3%, and the expected return on the market is 12%. 

What is the NPV of the project? and what is the IRR of the project?

Answer rating: 100% (QA)

To calculate the Net Present Value NPV of the project we need to discount the cash flows generated b... View the full answer