Please help me with these questions. Thanks

3. Problem 12-6 Payback method [LO12-3]

Assume a $270,000 investment and the following cash flows for two products:

Year	Product X			Product Y
1	$	70,000		$	90,000
2		100,000			80,000
3		95,000			80,000
4		50,000			40,000

a. Calculate the payback for products X and Y. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

b. Which alternative would you select under the payback method?

multiple choice

Product X is selected

Product Y is selected

4. Problem 12-7 Payback method [LO12-3]

Assume a $105,000 investment and the following cash flows for two alternatives.

Year	Investment X			Investment Y
1		$30,000			$40,000
2		45,000			35,000
3		15,000			35,000
4		30,000
5		10,000

a. Calculate the payback for investment X and Y. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

b. Which alternative would you select under the payback method?

multiple choice

Investment X

Investment Y

5. Problem 12-8 Payback method [LO12-3]

Assume a $60,000 investment and the following cash flows for two alternatives.

Year	Investment A			Investment B
1	$	15,000		$	45,000
2		15,000			10,000
3		20,000			25,000
4		20,000
5		30,000

a. Calculate the payback for investment A and B. (Round your answers to 2 decimal places.)

b. Which investment would you select under the payback method?

multiple choice 1

Investment A

Investment B

c. If the inflow in the fifth year for Investment A was $30,000,000 instead of $30,000, would your answer change under the payback method?

multiple choice 2

Yes

No

6. Problem 12-9 Payback method [LO12-3]

The Short-Line Railroad is considering a $185,000 investment in either of two companies. The cash flows are as follows:

Year	Electric Co.			Water Works
1	$	95,000		$	45,000
2		45,000			45,000
3		45,000			95,000
4 10		25,000			25,000

a. Compute the payback period for both companies. (Round your answers to 1 decimal place.)

b. Which of the investments is superior from the information provided?

multiple choice

Water Works

Electric Co.

7. Problem 12-10 Payback and net present value [LO12-3, 12-4]

X-treme Vitamin Company is considering two investments, both of which cost $42,000. The cash flows are as follows:

Year	Project A			Project B
1	$	44,000		$	42,000
2		15,000			14,000
3		15,000			20,000

Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

a-1. Calculate the payback period for Project A and Project B. (Round your answers to 2 decimal places.)

a-2. Which of the two projects should be chosen based on the payback method?

multiple choice 1

Project A

Project B

b-1. Calculate the net present value for Project A and Project B. Assume a cost of capital of 8 percent. (Do not round intermediate calculations and round your final answers to 2 decimal places.)

b-2. Which of the two projects should be chosen based on the net present value method?

multiple choice 2

Project B

Project A

c. Should a firm normally have more confidence in the payback method or the net present value method?

multiple choice 3

Payback method

Net present value method

8. Problem 12-11 Internal rate of return [LO12-4]

You buy a new piece of equipment for $31,548, and you receive a cash inflow of $4,000 per year for 11 years. Use Appendix D for an approximate answer but calculate your final answer using the financial calculator method.

What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

9. Problem 12-12 Internal rate of return [LO12-4]

Kings Department Store is contemplating the purchase of a new machine at a cost of $22,115. The machine will provide $5,000 per year in cash flow for seven years. Kings has a cost of capital of 9 percent. Use Appendix D for an approximate answer but calculate your final answer using the financial calculator method.

a. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

b. Should the project be undertaken?

multiple choice

no

yes