Problem 13-14 Spreadsheet Problem: PI (LG13-6) Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and 3.0 years, respectively. Time: Cash flow: -$ 231,000 $ 65,400 Use the PI decision rule to evaluate this project. Note: Do not round intermediate calculations and round your final answer to 2 decimal places. Pl Should it be accepted or rejected? (Click to select) $ 83,600 $ 140,600 $ 121,600 $ 80,800
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- ces Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects this risk class is 13 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively. Time: 1 2 3 5 Cash flow: -$290,000 $46,800 $65,000 $103,000 $103,000 $62,200 Use the MIRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) MIRR % Should it be accepted or rejected? O rejected O acceptedProblem 13-23 Payback (LG13-2) Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and 3.0 years, respectively. Time: Cash flow: 0 1 2 3 -$232,000 $65,500 $83,700 $140,700 Payback Use the payback decision rule to evaluate this project. (Round your answer to 2 decimal places.) years Should the project be accepted or rejected? rejected O accepted 4 $121,700 5 $80,900Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3.0 and 3.5 years, respectively. Time: 1 2 Cash flow: -$238,000 $66,100 $84,300 $141,300 $122,300 $81,500 Use the IRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) IRR % Should it be accepted or rejected?
- Problem 13-21 NPV (LG13-3) Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 7 percent, and that the maximum allowable payback and discounted payback statistics for the project are 2.0 and 3.0 years, respectively. Time: 1 Cash flow: -$7,400 $1,170 2 $2,370 3 4 $1,570 $1,570 5 $1,370 6 $1,170 Use the NPV decision rule to evaluate this project. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places.) NPV Should it be accepted or rejected? accepted O rejectedSuppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively. Time: Cash flow: 0 1 3 4 -$233,000 $65,600 $83,800 $140, 800 $121,800 MIRR Use the MIRR decision rule to evaluate this project. Note: Do not round intermediate calculations and round your final answer to 2 decimal places. 5 $81,000 %Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3.0 and 3.5 years, respectively. 18 Ints Time: 1 4 5 Cash flow: $66, 400 $84,600 $141,600 $122,600 $81,800 $351,000 Print Use the NPV decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) References NPV Should it be accepted or rejected? accepted O rejected
- Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3.0 and 3.5 years, respectively. Time: Cash flow: 1 2 -$236,000 $65,900 $84,100 $141,100 $122,100 $81,300 Use the IRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) IRR % Should it be accepted or rejected? O rejected acceptedSuppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and 3.0 years, respectively. 19 ts Time: 2 3 4 5 Cash flow: $65,600 $83, 800 $140,800 $121,800 $81,000 $233,000 Print Use the payback decision rule to evaluate this project. (Round your answer to 2 decimal places.) -ferences Payback 1.19 years Should the project be accepted or rejected? О ассepted O rejectedStart with the partial model in the file Ch07 P25 Build a Model.xlsx on the textbook’s Web site. Selected data for the Derby Corporation are shown here. Use the data to answer the following questions. Calculate the estimated horizon value (i.e., the value of operations at the end of the forecast period immediately after the Year-4 free cash flow). Assume growth becomes constant after Year 3. Calculate the present value of the horizon value, the present value of the free cash flows, and the estimated Year-0 value of operations. Calculate the estimated Year-0 price per share of common equity.
- Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 13 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and 3.0 years, respectively. Time: 1 2 3 4 5 Cash flow: $64,900 $83,100 $140,100 $121,100 $80,300 $345,000 Print Use the IRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) erences IRR Should it be accepted or rejected? О ассepted O rejectedSuppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3.0 and 3.5 years, respectively. Time: 1. 4 Cash flow: -$239,000 $66,200 $84,400 $141,400 $122,400 $81,600 Use the NPV decisiontule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) NPV Should it be accepted or rejected? O rejected O accepted MacBook Air5 Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 7 percent, and that the maximum allowable payback and discounted payback statistics for the project are 2.0 and 3.0 years, respectively. Time: 1 2 3 4 Cash flow: -$4,700 $1,170 $2,370 $1,570 $1,570 $1,370 $1,170 Use the discounted payback decision rule to evaluate this project. (Round your answer to 2 decimal places.) Print Ferences Discounted payback years Should it be accepted or rejected? аcсepted O rejected