NPV of k = $7486.68
IRR of k = 16% (not exact, comes out to -1.91 due to all of the rounding)
MIRR of k = 13.9% (not to sure of this I had a little bit of trouble doing it, but I think it is correct)
Hope this helps =)
2.0%
A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is rs = 10.5%, and the expected constant growth rate is g = 6.4%. What is the stock's current price?
Yes, an internal rate of return (IRR) can exceed 100 percent, particularly in projects with very high cash inflows relative to their initial investment. This typically occurs in situations with short payback periods and substantial early cash returns. However, such high IRRs might also indicate higher risk or potential issues with the sustainability of those returns. It's essential to evaluate the context and underlying assumptions when interpreting IRR values.
Percent error is typically used to describe the difference between an expected value and an observed value (measured in an experiment). To calculate percent error, you must know the expected (or theoretical) value, determined from reference manuals and formulas. Percent error = [(actual measured value)/(expected value) - 1] x 100% Let's say that you do a chemistry experiment, where you expect to use 30 mL of a hydrochloric acid solution to neutralize a prepared solution of sodium hydroxide. When you perform the experiment, you actually use 30.2 mL of hydrochloric acid solution. Percent error = [(30.2 mL) / (30 mL) - 1] x 100% = 0.667 % error
18
The MIRR of this project is 13.89% and the PI is 1.13.
Labor costs should be no more than 20 to 30 percent on a construction project. The cost may be lower for residential projects and higher for commercial projects.
The project is in good shape and should finish early and within budget
7%
Depending on whether you subtract actual value from expected value or other way around, a positive or negative percent error, will tell you on which side of the expected value that your actual value is. For example, suppose your expected value is 24, and your actual value is 24.3 then if you do the following calculation to figure percent error:[percent error] = (actual value - expected value)/(actual value) - 1 --> then convert to percent.So you have (24.3 - 24)/24 -1 = .0125 --> 1.25%, which tells me the actual is higher than the expected. If instead, you subtracted the actual from the expected, then you would get a negative 1.25%, but your actual is still greater than the expected. My preference is to subtract the expected from the actual. That way a positive error tells you the actual is greater than expected, and a negative percent error tells you that the actual is less than the expected.
Although it is conceptually unsound, the payback period is very popular in business as a criterion for assigning priorities to investment projects. Why is it unsound, and why is it popular? What are mutually exclusive investment projects? What is a dependent project? Briarcliff Stove Company is considering a new product line to supplement its range line. It is anticipated that the new product line will involve cash investment of $700,000 at time 0 and $1.0 million in year 1. After-tax cash inflows of $250,000 are expected in year 2, $300,000 in year 3, $350,000 in year 4, and $400,000 each year thereafter through year 10. Though the product line might be viable after year 10, the company prefers to be conservative and end all calculations at that time. a. If the required rate of return is 15 percent, what is the net present value of the project? Is it acceptable? b. What is its internal rate of return? c. What would be the case if the required rate of return was 10 percent? d. What is the project’s payback period? Lobers, Inc., has two investment proposals, which have the following characteristics: For each
tomato 6.33
Haha, FIB student? Nice way of asking for answer :P
A third party can provide 5 percent funding for the project by contributing a portion of the total project cost equal to 5 percent. This can be done through a direct financial investment, a grant, or a loan with favorable terms. The third party's contribution can help support the project's budget and overall success.
5
795 out of 850 is 93.53%
A stock is expected to pay a dividend of $1 at the end of the year. The required rate of return is rs 11%, and the expected constant growth rate is 5%. What is the current stock price?