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University
| Teaching Since: | Apr 2017 |
| Last Sign in: | 471 Weeks Ago, 3 Days Ago |
| Questions Answered: | 9562 |
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bachelor in business administration
Polytechnic State University Sanluis
Jan-2006 - Nov-2010
CPA
Polytechnic State University
Jan-2012 - Nov-2016
Professor
Harvard Square Academy (HS2)
Mar-2012 - Present
The firm has a 75% chance if it invests -$1,500 a return of $500 for 7-years, and a 25% chance of returning $25 for 7-years. Based on the above data, what is the project's net present value?
Assuming that all cash flows are discounted at 10%, if NPC chooses to wait a year before proceeding, how much will this increase or decrease the project's expected NPV in today's dollars (i.e., at t = 0), relative to the NPV if it proceeds today?
| a) |
-$1,312,456 |
|
| b) |
-$1,104,607 |
|
| c) |
-$875,203 |
|
| d) |
$105,999 |
|
|
e) $321,788 |
26) The firm has a 75% chance if it invests -$1,500 a return of $500 for 7-years, and a 25% chance of returning $25 for 7-years.
Assuming that all cash flows are discounted at 10%, if NPC chooses to wait a year before proceeding, how much will this increase or decrease the project's expected NPV in today's dollars (i.e., at t = 0), relative to the NPV if it proceeds today?
|
a) $77.23 |
||
|
b) $85.81 |
||
| c) |
$95.34 |
|
|
d) $105.94 |
||
|
e) $116.53
|
Exp-----------ect-----------ed -----------val-----------ue -----------of -----------cas-----------h f-----------low----------- = -----------75%-----------*50-----------0 +----------- 25-----------%*2-----------5 =----------- 38-----------1.2-----------5 Y-----------ear----------- Ca-----------sh -----------flo-----------w I-----------ntr-----------est----------- ra-----------te -----------Dis-----------cou-----------nte-----------d c-----------ash----------- fl-----------ow -----------0 ------------150-----------0 1-----------0% ------------15-----------00 -----------1 3-----------81.-----------25 -----------10%----------- 34-----------6.5-----------909----------- 2 -----------381-----------.25-----------