Question: Hello, I need your help to solve this chapter 8 case of essencial of finance (asia global) Q1) calculate the Internal rate of return/ modified
CHAPTER CASE HUTTI GOLD MINES LIMITED utti Gold Mines the mining and production of Limited (HGML) is engaged in gold in India. The flows each year from the mine are summarized in table below. The company has a 15 percent mines used by HGML are mainly located in the Hutti return on the proposed new site. Muski Precambrian greenstone geological belt. As- suming the company is assessing a new mine site in India and the management estimates that the new site will be productive for 10 years. Based on the in- formation provided by the company's geologist, the financial officer of the company is required to conduct an analysis of the new site and make recommenda- tion to the management on whether the company Cash Flow (S in millions) -500 90 100 150 180 190 140 100 80 60 -50 should open the new site. Based on the information provided by the geolo- gist, the financial officer has estimated the expected revenue, expenses of opening the mine, and the an- nual operating expenses, among other things. If the company opens the new site, it will cost $500 million today and it will have a cash outflow of $50 million in year 10 to close the mine site. The expected cash 10 Source: www.thehindu.comews records-net-profit-of-rs-188-cr QUESTIONS 1. Construct a spreadsheet to calculate the internal rate of return, modified internal rate of return, and net present value of the proposed mine. 2. Based on your analysis, would you recommend the management to open the new mine site
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