NEED THE DISCOUNT RATE PART OF THE QUESTION: MUST ROUND FINAL ANSWER TO 2 DECIMA
ID: 2715070 • Letter: N
Question
NEED THE DISCOUNT RATE PART OF THE QUESTION: MUST ROUND FINAL ANSWER TO 2 DECIMAL PLACES WITH NO OTHER CALCULATIONS BEING ROUNDED:
Here are the expected cash flows for three projects:
Cash Flows (dollars)
Project
Year:
0
1
2
3
4
A
5,300
+
1,075
+
1,075
+
3,150
0
B
1,300
0
+
1,300
+
2,150
+
3,150
C
5,300
+
1,075
+
1,075
+
3,150
+
5,150
d-1.
If the opportunity cost of capital is 12%, calculate the NPV for projects A, B, and C. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.)
Project
NPV
A
$
B
$
C
$
Here are the expected cash flows for three projects:
Explanation / Answer
A- -$5300+$1075/1.12+$1075/1.2544+$3150/1.404+$0/1.573 = -$1241.04 - NAV
B- -$1300+$0/1.12+$1300/1.2544+$2150/1.404+$3150/1.573 = $3268.592 - NAV
C- -$5300+$1075/1.12+$1075/1.2544+$3150/1.404+$5150/1.573 = $2031.875 - NAV
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