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Problems7. Calculate the IRR for the following projects: a. An initial outflow of $15,220 followed by inflows of $5,000, $6,000, and $6,500. b. An initial outflow of $47,104 followed by inflows of $16,000, $17,000, and $18,000.8. Calculate the NPV at 9% and the IRR for the following projects:a. An initial outlay of $69,724 and an inflow of $15,000 followed by four consecutive inflows of $17,000.b. An initial outlay of $25,424 followed by two zero cash years and then four years of inflows at $10,500. (Hint: See “Imbedded Annuities,” page 275 for parts b&c.)c. An outlay of $10,672 followed by another outlay of $5,000 followed by five inflows of $5,000.11. Hamstring Inc. is considering a project with the following cash flows:CoC1C2C3C4$(25,000)$10,000$12,000$5,000$8,000The company is reluctant to consider projects with paybacks of more than three years. If projects pass the payback screen, they are considered further by means of the NPV and IRR methods. The firm's cost of capital is 9%.17. Callaway Associates, Inc. is considering the following mutually exclusive projects. Callaway's Cost of capital is 12%.Project AProject B($80,000)($80,000)44,00065,00034,00030,00014,000014,00005,000 a. Calculate each project's NPV and IRR. b. Which project should be undertaken? Why?
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  1. neil2103
    Tutorial # 00008205 Posted By: neil2103 Posted on: 02/16/2014 05:13 PM
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    The solution of FN300 unit 7 assignment...
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