You are looking at a new project and you have estimated the following cash flows: Year...
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You are looking at a new project and you have estimated the following cash flows: Year 0 1 2 3 Your required return for assets of this risk is 12%. a) b) Cash Flows $165,000 $63,120 $70,800 $91,080 Calculate discounted payback period for the project. (4 marks) According to the Internal Rate of Return (IRR) rule, should you accept the project and why? (4 marks) You are looking at a new project and you have estimated the following cash flows: Year 0 1 2 3 Your required return for assets of this risk is 12%. a) b) Cash Flows $165,000 $63,120 $70,800 $91,080 Calculate discounted payback period for the project. (4 marks) According to the Internal Rate of Return (IRR) rule, should you accept the project and why? (4 marks)
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Answer rating: 100% (QA)
a To calculate the discounted payback period for the project we need to determine the point in time at which the cumulative discounted cash flows equa... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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