Question: Need to calculate complete some homework. Full calculation process and explanations required. 1) Year 0 1 2 3 4 5 6 Cash Flow -110000 30000

Need to calculate complete some homework. Full calculation process and explanations required.

1)

Year

0

1

2

3

4

5

6

Cash Flow

-110000

30000

40000

20000

70000

20000

20000

Given the cash flows in the table above, calculate the payback period assuming the cash flows in years 1 to 4 occur evenly throughout the year. The required rate of return is 12%.

2) Calculate the NPV of a project that has an outlay of $300,000 and has annual net cash flows of $50000 per year over 6 years. The project has a salvage value (disposal value) of 10% of its original value. The required rate of return for projects of similar risk is 0.11

3) Given the following information calculate the Accounting Rate of Return (ARR gross).

Outlay = 200000

Annual Cash Flow = 70000 per year over four years

Life = 4 years

Rate = 0.12, as a decimal

4)Project A has an NPV of 100000. The project is financed by borrowing at 7%pa. The cost of capital for Project A is 0.11. This rate is expressed as a decimal, e.g. so that .12 is equal to 12%. The project has 4 year life. Calculate the Annual Equivalent (AE). Your textbook calls this EAV, Equivalent Annual Value. Calculate to the nearest dollar

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