1.Problem 1. ChemTech - Free Cash Flow 0

Chemtec is undertaking a project that will require an upfront investment today in net working capital, and plant and equipment (i.e., capital expenditures) of$100

million and$200

million, respectively. If there are no revenues or expenses expected until next year, what is the project's free cash flow today in millions of dollars?

*Make sure to input all currency answers without any currency symbols or commas, and use two decimal places of precision.

2.Problem 2. ChemTech - Free Cash Flow 1

Continuing from Problem 1, at the end of the first year, Chemtec is expecting sales of$250

million and costs of$125

million. There are no more required investments in either net working capital or plant and equipment. However, the existing plant and equipment will experience$50

million of depreciation.

Assume that Chemtec's marginal tax rate on earnings is35%

.

Assuming that all of these cash flow occur at the end of the first year, what is the first year's free cash flow?

*Make sure to input all currency answers without any currency symbols or commas, and use two decimal places of precision.

3.Problem 3. Jones - NPV

Jones Corp is evaluating a project that has the following annual free cash flows:

Period0

1

2

Free Cash Flow150

100

150

If the project's discount rate is12%

, then what is the NPV of the project?

*Make sure to input all currency answers without any currency symbols or commas, and use two decimal places of precision.

4.Problem 4. Donalds - IRR

Donalds Inc. is evaluating a project that has the following annual free cash flows:

Period0

1

Free Cash Flow175

200

What is the projects IRR?

*Make sure to input all percentage answers as numeric values without symbols, and use four decimal places of precision. For example, if the answer is 6%, then enter 0.0600.