Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. a project generates cash flows of $125k, $125k, an

A project generates cash flows of $125k, $125k, and $95k. The required rate of return is...

Free

70.2K

Verified Solution

Question

Finance

A project generates cash flows of $125k, $125k, and $95k. Therequired rate of return is 10%. The value of the project or “asset”is $288,317.

Given your answer, which ones are true.

IRR = 10%

PI = 1.0

NPV = 0

Answer & Explanation Solved by verified expert
4.4 Ratings (620 Votes)

Statement showing Cash flows
Particulars Time PVf 10% Amount PV
Cash Outflows                        -                        1.00         (288,317.00)         (288,317.00)
PV of Cash outflows = PVCO         (288,317.00)
Cash inflows                    1.00                 0.9091           125,000.00           113,636.36
Cash inflows                    2.00                 0.8264           125,000.00           103,305.79
Cash inflows                    3.00                 0.7513              95,000.00              71,374.91
PV of Cash Inflows =PVCI           288,317.05
NPV= PVCI - PVCO                        0.05
PI = PVCI/PVCO                        1.00
All are true. As NPV is 0 at 10% which means IRR is also 10% and PI is 1

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

A project generates cash flows of $125k, $125k, and $95k. Therequired rate of return is 10%. The value of the project or “asset”is $288,317.Given your answer, which ones are true.IRR = 10%PI = 1.0NPV = 0

Other questions asked by students

Q

•        Sources of Law o What are the sources of Federal and State Law? •        Legal Reasoning...

General Management
Q

The life insurance industry maintains that the average worker in Saskatoon has no more than $25,000...

Basic Math
Q

Suppose Set A contains 36 elements and the total number elements in either Set A...

Basic Math
Q

Exercise Find the market equilibrium point for the following demand and supply functions Demand p...

Algebra
Q

Required information Use this information for the questions IE-16 through IE-19 Skip to question [The...

Accounting
Q

Ch4A-8(Algo) Lambda Computer Products competed for and won a contract to produce two prototype...

Accounting
Q

Bruce and June were married. At the time of Bruce's death, they owned the following:...

Accounting
Q

E 7-8 Sales returns L07-4 Halifax Manufacturing allows its customers to return...

Accounting
Q

In dealing with a global health crisis, In your opinion, what financial institutions and markets...

Accounting
Q

please answer 1,2,3 Aspen Park Senior Center bas a woekly paytol...

Accounting
Q

21 estion 21 3.57 points Save Answe Fletcher Corporation is considering buying a new...

Accounting
Q

Chen wants to know which of the benefits to be paid out to his beneficiaries...

Finance