Question: How do you do this problem? Please show step by step either on excel or paper. TIA! Suppose your firm is considering investing in a
How do you do this problem? Please show step by step either on excel or paper. TIA!
Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3.0 and 3.5 years, respectively.
Time: 0 1 2 3 4 5
Cash Flow: -$237,000 $66,000 $84,200 $141,200 $122,200 $81,400
Use the NPV decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.)
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