Question: Consider the investment projects given in Table P7.10. (a) Classify each project as either simple or nonsimple. (b) Use the quadratic equation to compute i
Consider the investment projects given in Table P7.10.
(a) Classify each project as either simple or nonsimple.
(b) Use the quadratic equation to compute i* for project A.
(c) Obtain the rate(s) of return for each project by plotting the NPW as a function of the interest rate.
TABLE P7.10 n 0 1 2 3 4 5 6 7 A -$250 450 - 120 |||| B -$300 100 110 180 75 ||| Project Cash Flow C -$400 $200 15 50 -185 100 45 500 D -$100 120 40 40 -200 40 30 E - $60 - 120 -50 0 160 150 140 130
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