Question: 8. Assume the following cash flows from two different projects: Year Project A Project -1,000 800 500 80 80 900 760 500 100 Which Project

 8. Assume the following cash flows from two different projects: Year

8. Assume the following cash flows from two different projects: Year Project A Project -1,000 800 500 80 80 900 760 500 100 Which Project has the higher Internal Rate of Return? A. Project A-21.2% B. Project B-32.6% C. Project B-26.3% D. Project A-185% E. Not enough information F. They are the same Assume you are presented with an opportunity to invest $10,000 right now in exchange for $2,000 per year for six years. Assuming a discount rate of 8% what is the NPV of this payment stream? A. -$754.24 (negative) .so C. $1,482.11 D. -698.37 (negative) 9. 10. The Internal Rate of Return is that discount rate at which NPV equals zero. Commentec A. True B. False 11. A new piece of equipment will cost $3,000 to purchase and install. However, it is anticipated that it will provide annual net positive cash flows of $800 per year for the next six years. What would be the NPV of this cash stream assuming the opportunity cost of capital was 12%? A. $289.13 B. $1,800.00 C $3,289.13 D. $3.484.21

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!