Anemone Amaryllis is planning to upgrade the greenhouses at her garden center. She has projected the...
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Anemone Amaryllis is planning to upgrade the greenhouses at her garden center. She has projected the following cash flows based on an initial investment of $170,420. The required return on the project is 14 percent. Cash Flow YEAR 0 1 2 3 -$170,420 $63,638 $74,670 $93,900 A. What is the net present value of the project? Do not round Intermediate steps. (5 points) B. Should the project be accepted based on the NPV? (1 point) ye C. What is the IRR? Round percentage to 2 decimal places. You do not need to show your work on this problem. (5 points) D. Should the project be accepted based on the IRR? (1 point). E. What is the profitability index of the project? Do not round intermediate steps. Round percentage to two decimal places. (5 points) F. Should the project be accepted based on the profitability index? (1 point) Anemone Amaryllis is planning to upgrade the greenhouses at her garden center. She has projected the following cash flows based on an initial investment of $170,420. The required return on the project is 14 percent. Cash Flow YEAR 0 1 2 3 -$170,420 $63,638 $74,670 $93,900 A. What is the net present value of the project? Do not round Intermediate steps. (5 points) B. Should the project be accepted based on the NPV? (1 point) ye C. What is the IRR? Round percentage to 2 decimal places. You do not need to show your work on this problem. (5 points) D. Should the project be accepted based on the IRR? (1 point). E. What is the profitability index of the project? Do not round intermediate steps. Round percentage to two decimal places. (5 points) F. Should the project be accepted based on the profitability index? (1 point)
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Answer rating: 100% (QA)
A To calculate the Net Present Value NPV we need to discount each cash flow to its present value Usi... View the full answer
Related Book For
Personal Financial Planning
ISBN: 9780357438480
15th Edition
Authors: Randy Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Posted Date:
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