A firm has multiple net cash inflow return options from an investment of $24 million.  The required rate of return for the firm is 13.51 percent. 

Option (i): Cash inflows of $5.77 million at the end of each year for the next 6 years; 

Option (ii): Cash inflows at the end of Year-1 $6 million, Year-4 $13 million and Year-5 $8 million; 

Option (iii): Cash inflows of $5.21 million at the beginning of each year for the next 5 years; 

Option (iv): Cash inflows of $1.40 million at the end of each quarter for the next 4 years; 

Option (v): Cash inflows of $0.38 million at the end of each month that will continue forever.

Find the best option that would be aligned with the principal goal of Financial Management. Show your calculations to support your selection.

Answer rating: 100% (QA)

The principal goal of financial management is to maximize the value of the firm which is achieved by ... View the full answer