Question: 14. Hydroponics is considering adding another greenhouse that would cost $95,000 and generate $20,000 in annual net cash flows over its 8 year expected life.

14. Hydroponics is considering adding another greenhouse that would cost $95,000 and generate $20,000 in annual net cash flows over its 8 year expected life. The greenhouse would be depreciated on a straight-line basis to zero and the salvage value is also expected to be zero. If the firm has a marginal tax rate of 40 percent, what is this projects internal rate of return?

a. between 20 and 24%

b. between 13 and 14%

c. between 28 and 32%

d. between 7 and 8%

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Hydroponics is considering adding another greenhouse that would cost $95,000 and generate $20,000 in annual net cash flows over its 8 year expected life. The greenhouse would be depreciated on a...

Hydroponics is considering adding another greenhouse that would cost $ 9 5 , 0 0 0 and generate $ 2 0 , 0 0 0 in annual net cash flows over its 8 year expected life. The greenhouse would be...

Hydroponics is considering adding another greenhouse that would cost $95,000 and generate $20,000 in net cash flows per year over its expected 8-year life. The greenhouse would depreciate in a...

Inverted Processes, Inc., is considering adding another greenhouse that would cost $95,000 and generate $20,000 in annual net cash flows over it's 8 year expected life. The greenhouse would be...

Need help with these discussion postings (in a document) and assignments (all in separate files), all directions are included as well. FINANCE DIRECTIONS Need to provide 1 original post substantial...

Questions: i. Rank the projects on the basis of the measurements discussed above. ii. Was Smith correct in stating that all of the measurements necessarily would result in the same ranking order?...

Taking on a responsibility you know can be better completed by someone else would violate the ethical conduct standard of: competency. confidentiality. credibility. integrity. Question 2 Which term...

Sponge Pants and Square Bob is considering building a water slide park that will require a net investment of $200,000 and yield the following net cash flows: Year Net Cash Flows Cert. Equiv. Factor ....

How does substrate-level phosphorylation differ from phosphorylation linked to the electron transport chain?

Which of the following can be true? If an answer is false, state why it is false a. The graph of fx(x) can have jumps (i.e., can be discontinuous). b. The graph of Fx(x) for discrete random variables...

2. Full costing includes which of the following in determining product cost? a. Only variable costs of production. b. Only fixed costs of production. c. Administrative overhead. d. All fixed and...

Governmental attitudes toward issues such as private property, intellectual property, zoning, pollution, and employment stability may change over time. The term associated with this phenomenon is a ....

4. The Kaiser Permanente Health System is often held out as an employer with very good labor relations. What can you discern from websites such as www.kaiserpermanentejobs .org/jobs.aspx that might...

4. How would you deal with the store manager?

1. Briefly describe the history and structure of the U.S. labor movement.