A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows:
Year Cash Flow 0 â$ 28,600 1 12,600 2 15,600 3 11,600
What is the NPV for the project if the required return is 11 percent? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
NPV $
At a required return of 11 percent, should the firm accept this project? No Yes
What is the NPV for the project if the required return is 25 percent? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
NPV $
At a required return of 25 percent, should the firm accept this project? Yes No
| A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: |
| Year | Cash Flow | ||
| 0 | â$ | 28,600 | |
| 1 | 12,600 | ||
| 2 | 15,600 | ||
| 3 | 11,600 | ||
| What is the NPV for the project if the required return is 11 percent? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| NPV | $ |
| At a required return of 11 percent, should the firm accept this project? | ||||
|
| What is the NPV for the project if the required return is 25 percent? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16)) |
| NPV | $ |
| At a required return of 25 percent, should the firm accept this project? | ||||
|
Related questions
| A project that provides annual cash flows of $16,700 for ten years costs $73,000 today. |
| What is the NPV for the project if the required return is 9 percent? (Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., 32.16.) |
| NPV | $ |
| At a required return of 9 percent, should the firm accept this project? | ||||
|
| What is the NPV for the project if the required return is 21 percent? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
| NPV | $ |
| At a required return of 21 percent, should the firm accept this project? | ||||
|
| At what discount rate would you be indifferent between accepting the project and rejecting it? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) |
| Discount rate | % |
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| A firm evaluates all of its projects by using the NPV decision rule. At a required return of 10 percent, the NPV for the following project is $___________ and the firm should accept / reject the project. At a required return of 29 percent, the NPV is $____________ and the firm should reject / accept the project. (Do not include the dollar signs ($). Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. (e.g., 32.16)) |
| Year | Cash Flow |
| 0 | ?$27,000 |
| 1 | 23,000 |
| 2 | 16,000 |
| 3 | 9,000 |
| | |
