If you insulate your office for $1,000, you will save $100 a year in heating expenses These savings will last forever a What is the NPV of the investment when the cost of capital is 8 10 b What is the IRR of the investment c What is the payback period on this investment d What is the discounted pay...

a The present value of the savings is 100r If r 08 PV 1250 and NPV 1000 1250 250 If r 1 ...

If you insulate your office for $1,000, you will save $100 a year in heating expenses. These

Question:

If you insulate your office for $1,000, you will save $100 a year in heating expenses. These savings will last forever.
a. What is the NPV of the investment when the is 8%? 10%?
b. What is the IRR of the investment?
c. What is the on this investment?
d. What is the discounted on this investment when the is 8%? 10%?
Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of... Payback Period
Payback period method is a traditional method/ approach of capital budgeting. It is the simple and widely used quantitative method of Investment evaluation. Payback period is typically used to evaluate projects or investments before undergoing them,...