A project requires initial investment of 30 mln at t = 0 (t in years) 20...
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A project requires initial investment of 30 mln at t = 0 (t in years) 20 mln at t=1, and 10 mln after two years. Income will be received over a 17-year period beginning from t = 3 with regular annual payment of 5 mln till 20 years (included). (1) Calculate the NPV (Net Present Values) of the project at an effective rate of interest of 3% p.a. (2) What is the new NPV value if we double the level of the interest rate. (3) Calculate the DPP (Discounted Payback Period) of the project at an effective rate of interest of 3% p.a. (4) Calculate the accumulated value of the project at t=20 years. A project requires initial investment of 30 mln at t = 0 (t in years) 20 mln at t=1, and 10 mln after two years. Income will be received over a 17-year period beginning from t = 3 with regular annual payment of 5 mln till 20 years (included). (1) Calculate the NPV (Net Present Values) of the project at an effective rate of interest of 3% p.a. (2) What is the new NPV value if we double the level of the interest rate. (3) Calculate the DPP (Discounted Payback Period) of the project at an effective rate of interest of 3% p.a. (4) Calculate the accumulated value of the project at t=20 years.
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1 To calculate the NPV of the project at an effective rate of interest of 3 pa we need to discount t... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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