Please answer the following: Period Period Period Period Project Investment 1 Cash 2 Cash 3 Cash...
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Please answer the following: Period Period Period Period Project Investment 1 Cash 2 Cash 3 Cash 4 Cash Flow Flow Flow Flow 50 70 50 100 100 20 80 10 A B 200 150 IRR NPV PI a) (10 points) Calculate the IRRS, NPVS, and Pls for the 2 projects above (Place the answers i the appropriate boxes; if needed, use a discount rate of 10%). If these are mutually exclusive projects, what investment recommendation would you make about these 2 projects and why? b) (6 points) Having studied the net present value (NPV) and the profitability index (PI) during our sessions, briefly list/explain what "information" (similar and/or different information) the NPV and the PI provide to the user (i.e. the numbers you calculated are the answers to what questions about value) - in short, what do each of the 2 methods tell you (compare and contrast-don't simply define how to calculate). Under what circumstances would you use one criteria over the other or both? Please answer the following: Period Period Period Period Project Investment 1 Cash 2 Cash 3 Cash 4 Cash Flow Flow Flow Flow 50 70 50 100 100 20 80 10 A B 200 150 IRR NPV PI a) (10 points) Calculate the IRRS, NPVS, and Pls for the 2 projects above (Place the answers i the appropriate boxes; if needed, use a discount rate of 10%). If these are mutually exclusive projects, what investment recommendation would you make about these 2 projects and why? b) (6 points) Having studied the net present value (NPV) and the profitability index (PI) during our sessions, briefly list/explain what "information" (similar and/or different information) the NPV and the PI provide to the user (i.e. the numbers you calculated are the answers to what questions about value) - in short, what do each of the 2 methods tell you (compare and contrast-don't simply define how to calculate). Under what circumstances would you use one criteria over the other or both?
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Answer rating: 100% (QA)
a Project A IRR 15 NPV 20 PI 105 Project B IRR 20 NPV 150 PI 15 If these are mutually exclusive proj... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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