Question: Agape Mining Inc. is evaluating a project with the following cash flows: Year Cashflow 0 -$380,000,000.00 1 $79,000,000.00 2 $82,000,000.00 3 -$53,000,000.00 4 $175,000,000.00 5
Agape Mining Inc. is evaluating a project with the following cash flows:
| Year | Cashflow |
| 0 | -$380,000,000.00 |
| 1 | $79,000,000.00 |
| 2 | $82,000,000.00 |
| 3 | -$53,000,000.00 |
| 4 | $175,000,000.00 |
| 5 | $195,000,000.00 |
| 6 | -$40,000,000.00 |
| 7 | $188,000,000.00 |
| 8 | $71,000,000.00 |
- Construct a spreadsheet and calculate the following (the required rate of return is 11%):
- Payback period
- Discounted payback period
- Internal rate of return (IRR)
- Modified IRR
- The discounting approach
- The reinvestment approach
- The combination approach
- Net present value (NPV)
- Based on your analysis, should the company take the project? Why?
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