A project costs $91,000 today and is expected to generate cash flows of $11,000 per year for the next 20 years. The firm has a cost of capital of 8 percent. Should this project be accepted, and why?.

Answers

Answer 1

A project with cost of $91,000 and will generate cash flow of $11 per year for 20 years should be accepted since its NPV is $16,992.62.

Net Present Value or NPV is a project evaluation method to evaluate whether a project will generate profit or loss based on its projected cash flows in present value term.

To calculate a project NPV, we need to use a formula:

NPV = Initial Investment + PV of annuity

where:

PV of annuity = P {(1 - (1 + r)^-n) /r]

P = projected cash flow per year

r = interest rate = cost of capital

n = payment period

From the case, we have some informations:

Initial investment = $91,000

P = $11,000

n = 20 years

r = 8%

We can calculate the PV of annuity for this project is:

PV of annuity = P {(1 - (1 + r)^-n) /r]

PV of annuity = $11,000 [(1 - (1 + 0.08)^(-20)) / 0.08]

PV of annuity = $107,999.62

Then, the project's NPV would be;

NPV = Initial Investment + PV of annuity

NPV = ($91,000) - $107,999.62

NPV = $16,999.62

Learn more about Net Present Value here: brainly.com/question/17080412

#SPJ4


Related Questions

Do you think a client’s wishes should trump ethics in the mind of an advertising professional? Why or why not?

Answers

Answer: They should not.

Explanation:

When it comes to the advertising industry, the wishes of the client are not of the highest priority, they are of the second highest priority.

The highest priority is to the industry and its integrity. If advertisers acted in an unethical manner, they would risk destroying the reputation of the advertising industry which would lead to a massive loss of trust in it that could severely impact it.

Regardless of how important a client might be therefore, their wishes should never trump the ethics required in the industry because these ethics maintain the integrity of the advertising profession.


The human resource manager is undecided about whether to use internal or external
recruitment for filling the supervisor vacancy. Which method would you recommend? Justify
your answer, with advantages and disadvantages.

Answers

Advantages would be used I think

In VAT (Value added tax) is it profitable to buy in large or small quantities?​

Answers

It’s more profitable to buy in large quantities.

Gianna put $1,000 in a savings account for 18 months. The interest on the account is 3.5%.

How much will Gianna earn in interest? What amount will she have at the end of the time period?

Answers

Answer:

You will earn $52.96 in interest

You have $1,052.96 in total.

HELP ME PLEASEE!! ILL GIVE CROWN!!!
which of the following should credit be used for?
A. small things you want
B. large things you need and that you can repay over time.
C. money that you can never afford to repay.
D. purchasing things you want so you dont have to save.

Answers

Answer:

B

Explanation:

Credit should be used for large things that you can't afford at the moment but over time will be able to repay (like bills). You should never purchase things that are too expensive for you to repay (within a year.)

How do I find the cash flow coverage ratio?

Answers

Explanation:

There are a few different ways to calculate the cash flow coverage ratio formula, depending on which cash flow amounts are to be included. A general measure of the company’s ability to pay its debts uses operating cash flows and can be calculated as follows:

Cash flow coverage ratio = $80,000,000 / $38,000,000 = 2.105Cash flow coverage ratio = ($64,000,000 + $4,000,000 + $8,000,000) / $38,000,000 = 2

Which of these is NOT a concern for consumers in times of inflation?
a.They cannot anticipate the cost of goods and services.
b.They lose money on their investments and savings.
c.They are at a disadvantage when paying back borrowed money.
d.They struggle when they are on a fixed income.

Answers

Answer: D

Explanation:

What does the term 'user
experience' refer to regarding a
website?
A. the overall ease of navigation and ability to
purchase on a company's website
B. the general experience a customer has when
using a product of a business
C. the customer experience when dealing with
customer service representatives

Answers

Answer:b

Explanation:

brief explain difference between moa and aoa ?​

Answers

Answer:

The MOA (Memorandum of Association) describes the powers and objects of the company, the AOA (Article of Association) defines its rules and the AOA (Articles of Association) is subordinate to the memorandum.

In what type of economy do individuals and firms determine what will be produced?
Mixed
Traditional
Market
Command

Answers

Answer:

market

Explanation:

I think it’s warket hope this helps

Which of these is NOTa concern for consumers in times of inflation? a.They cannot anticipate the cost of goods and services. b.They lose money on their investments and savings. c.They are at a disadvantage when paying back borrowed money. d.They struggle when they are on a fixed income.

Answers

Answer:

c.They are at a disadvantage when paying back borrowed money.

Explanation:

In any economics of a country, inflation may be defined as the fall of the value of the money or currency of a country over a period of time. In inflation, the general price level increase and the value of money decreases.

Due to inflation, with each currency unit, less of goods or services can be bought. In inflation, the consumers are not concern about the disadvantage when they pay back the money that they borrowed because the value of the money decreases. Money decreases its value but the demand of goods and services increases in the economy.

what's the answer? please help, it's overdue​

Answers

Answer: Honestly in my opinion that's a no

Explanation: because that's there imagine without them they wouldn't be able to get that image up and making profit therefore the player should get a cut of the profit that is made.

equity shareholders are called what ​

Answers

Answer:

owners

Explanation:

Shareholders' equity represents the amount invested by the owners of a company in the business by either retaining earnings over time or by investing money in it. The shareholders' equity is a form of a company's net assets. Equity shareholders are also known as Equity Stockholders.

The equity shareholders of a company are called its owners.

____ reading will increase your focus and concentration, help you understand the reading, and prepare you to study.

Answers

Answer:

Active.

Explanation:

Active reading can be defined as a process which typically involves an individual being focused on his or her study. It is aimed at acquiring knowledge and understanding of a particular subject or topic without distractions.

Hence, active reading will increase your focus and concentration, help you understand the reading, and prepare you to study.

An oligopoly is a market structure in which a large number of firms dominate the market. T or F

Answers

Answer: F

Explanation:

An oligopoly is a market structure in which a large number of firms dominate the market.

An oligopoly is a market structure in which a large number of firms dominate the market. FALSE.

Which part of the check gives the bank permission to release the money?

Answers

Answer:

And even though all national banks and federally chartered credit unions are subject to the same hold rules, each institution can release your funds sooner at its discretion. By understanding the rules of funds availability, you can ensure you'll have access to your money when you need it.:

Janice, a nurse at a hospital, is preparing a presentation for trainee nurses about guidelines for patient care. What is the purpose of her
presentation?


A. to persuade

B. to instruct

C. to entertain

D. to debate

Answers

Answer:

B

Explanation:

To teach and acknowledge the guidelines for trainee nurses to help patients in an effective way

What would Jamie Lee's financial liability have been had she waited more than two days to report the debit/ATM card lost or stolen

Answers

Explanation:

If Jamie notifies the bank within 2 days of the lost card , her liability for unauthorized would be $50.

Jamie Lee's as the account holder is financially responsible for any form of transfers or withdrawals that has or will be made from their accounts and until He report the theft, he will be liable to all withdrawals.

What is a Checking Account:

A checking account is known to be a kind of bank account that is often used by people as a deposit account.

The usual amount deposited by them in this account is known to be used for paying bills and other form of purchases.

Base on the fact above, Jamie Lee's would be liable for his financial liability because she had waited for more than two days to report her debit/ATM card lost or stolen and as such any theft that happen within those two days on her account is her fault.

Learn more about  checking account from

https://brainly.com/question/24751568

By law, an accountant must hold a CPA designation in order to
?

Answers

Answer:

The CPA designation isn't required to work in corporate accounting or for private companies. However, public accountants⁠—which are individuals working for a firm, such as Deloitte or Ernst & Young, that provides accounting and tax-related services to businesses—must hold a CPA designation.

Explanation:

Answer:

Prepare audited or reviewed financial statements.

Hope this helps :)

HELP FOR CROWN!!!
what is one thing a bank will require you to have when you ask for an auto loan?
A. keys to the car
B. proof of auto insurance
C. driver's license
D. letter of recommendation

Answers

Answer:

It is either C or D

Explanation:

Answer:

Driver's License

Question 6 of 10
The practice of fractional reserve banking means that:
O A. banks are required by law to operate as nonprofit organizations.
O B. banks are not allowed to use deposited funds to make loans.
O C. banks can change the interest rates on loans at any time.
O D. banks only keep a portion of their deposits as cash reserves.

Answers

Answer:

D. banks only keep a portion of their deposits as cash reserves.

Explanation:

A fractional reserve system needs a commercial bank to maintains the customer deposit percentage at the time of custody. This means that at any time the deposit fraction should have the cash backing i.e. physical also the fraction should be maintained

So according to the given situation, the last option is correct as the bank keep a portion of the deposits in cash reserves

Four people are applying for a job. This chart shows the company’s favorite characteristic of each of these job applicants:

Answers

There is no chart present.

what percentage of CTE learners enroll in post secondary education?​

Answers

Answer:

10th-grade public school students in 2002 who were CTE concentrators in high school, 72 percent enrolled in postsecondary education by 2006, or two years after their expected year of high school graduation, and 84 percent enrolled by 2012, or eight years after their expected year of high school graduation.

Answer:

75% – Percentage of high school students concentrating in a CTE discipline who pursue post-secondary education 43% – Percentage of young workers holding a CTE-related license or certificate who earn more than those holding an associate degree

Explanation:

Shareholders had a good year, earning a 29% annual rate of return. The PE ratio today is 10.0 and the company just announced earnings per share of $2.50. The company has a 90% payout ratio. How much did the stock price change over the past year?

Answers

Answer:

$3.68

Explanation:

Rate of return =29%

PE ratio = 10.0

Earning per share = $2.50

P1 = PE ratio * EPS

P1= 10*2.50

P1 = $25

Payout ratio = 90%

Dividend = 2.50*90%

Dividend = $2.25

Rate of return = (P1+D1-P0)/P0

0.29= (25 + 2.25 - P0)/P0

0.29 P0 = 27.50 - P0

1.29P0 = 27.50

P0 = 27.50/1.29

P0 = $21.32

Change in stock price = $25 - $21.32

Change in stock price = $3.68

What are three elements of negligence?
Actual Harm
Breach of duty
State of mind
Duty of care
Proximate cause
Motive

Answers

Answer:

actual harm

breach of duty

duty to act

Suppose the GDP of the entire European Union is 350,000 euros and the exchange rate between euros and USD is 0.66 EURO=$1. What is the GDP of the European Union when measured in USD? Round your answer to the nearest hundredth.

Answers

Answer:

the GDP of the  European Union is $530,303.030

Explanation:

The computation of the GDP of the  European Union is shown below:

= Entire european union × euro ÷ exchange rate

= 350,000 euros × $1 ÷ 0.66

= $530,303.030

Hence, the GDP of the  European Union is $530,303.030

We simply applied the above formula

who wants to make a call??

Answers

Answer:

Zoom you mean?

Explanation:

Answer:

I want to call my mom,lol

Martin is a credit counselor working with a client, Kim, who is in serious financial trouble. Kim is hesitant because she has a long way to go and a lot of work to do before she can be financially healthy again. What is the best way for Martin to explain the next steps to her?

A.) Martin should present the information in small manageable steps rather than give her a lengthy to-do list.

B.) Martin should make a list of tasks that must be completed and do them for her, since he is an experienced professional.

C.) Martin should compile a list of all the tasks that Kim must complete and suggest that she report back to him after she is finished.

D.) Martin should not encourage her to do anything she is reluctant to do, even if it means salvaging her financial life in the long term​

Answers

Answer:

C

Explanation:

C la respuesta es la C ya que

If the food handler has been diagnosed with one of the Big 6 pathogens
they can return to work 24 hours after showing no symptoms.
TRUE
FALSE

Answers

It’s False bro trust me

Answer:

False.

Explanation:

If 42 of 500 people who clicked
your add bought a product online,
what would your conversion ratę
be?
A. 2.4%
B. 8.4%
C. 12.8%
D. 15.2%

Answers

Answer:

Conversion rate = 8.4%

Explanation:

Given:

Number of person clicked = 42

Total people = 500

Find:

Conversion rate

Computation:

Conversion rate = [Number of person clicked / Total people]100

Conversion rate = [42 / 500]100

Conversion rate = 8.4%

Other Questions
Which of the following sequences correctly describes the pathway that a signal travels in a neuron?a. cell body to axon to dendriteb. axon to dendrite to cell bodyc. dendrite to axon to cell bodyd. dendrite to cell body to oxygen randy is participating in the strange situation. when his mother returns after being gone from the room, he is happy and greets her warmly. what attachment style does randy likely have? can someone help me asap????what is 254x9273? solve for x!!! 9. In lesson 4, we read an excerpt from a memoir titled "A Double ImpulseIn 2-3 complete sentences, explain the conflict that the author Houstonexperiences. Provide one piece of textual evidence along with an in-textcitation. Between 1663 and 1681,Maryland differed from other English colonists in that itA)required masters to emancipate any slave who converted to Christianity.B)formally recognized marriages between black slaves and free whites.C)stipulated that,whether a black woman was enslaved or free,her children would be slaves.D)allowed black men to gain their independence by serving in the colonial militia against Native Americans. Explain what is meant by a positive relationship between two variables and a negative relationship between two variables. Give an example of a situation in which you would expect to find a positive relationship and when you would expect to find a negative relationship. A student used 0. 230g of oxalic acid dissolved in 50. 0 mL of water as a primary standard (MW 126. 07 g/mol). 37. 10 mL of sodium hydroxide aqueous solution were required to titrate the sample. What is the molarity of the sodium hydroxide solution? The neutralization reactions is: HOOCCOOH + 2 OH OOCCOO + 2 H2O if a security that is a capital asset becomes worthless due to the insolvency of their issuer, the loss is deemed to have occurred on the the benefit/cost analysis is used to primarily to evaluate projects and to select from alternatives what is the hydrogen ion concentration in a blood sample that registers a ph of 7.30 using a ph meter? The reason that the invasive species, the Formosan Subterranean Termite is such a problem isIt is an aggressive feeder and can colonize above groundIts native range in the Eastern United States has changed, causing it to disperse farther, outside of its normal habitatIt eats soft metal products as well as woodIt is an intermediate host for a new human disease find all values of the unknown constant(s) for which A is symmetric. A = 4 a+5 -3 -1 3.list and describe five common vulnerabilities that can be exploited in code. the fundamental attribution error is illustrated in our tendency to understimate the extent to which others' behavior is influenced by what? Table 14-17 The table below shows the price and cost information for a firm that operates in a perfectly competitive market. Quantity Total Cost $6 | Price | $8 | $8 | $8 | $8 1 2 3 $10 $15 $21 $28 $36 $45 $ 85 Refer to Table 14-17. Based upon this information, if the firm is producing the profit maximizing output, how much profit does the firm make? O a. $6. b. $40. O c. $4. Od. $32. Discuss how Ichabod Cranes powerful imagination leads to his downfall. Defend your position with convincing reasons in a one paragraph response, citing evidence from the text Linel is the perpendicular bisector of segment ac, d is any point on ldwhich reflection of the plane can we use to prove d is equidistant from a and c, and why? A and B are both looking at different views of a Measure the diameter of the following circles, which represent induration from a Mantoux tuberculin skin test. Ai limeter ruler is provided below. Cut it out and use it to measure the tuberculin reactions. Record results in the chan N. Measuring Mantoux Test Reactions provided. 50 Points! Multiple choice algebra question. Photo attached. Thank you!