Using the Payback Method, IRR, and NPV
Due Feb 05, 11:59 PM
Purpose of Assignment
The purpose of this assignment is to allow the student to calculate the project cash flow using net present value (NPV), internal rate of return (IRR), and the payback methods.
Resources: Corporate Finance
Create a 350-word memo to management including the following:
Describe the use of internal rate of return (IRR), net present value (NPV), and the payback method in evaluating project cash flows.
Describe the advantages and disadvantages of each method.
Calculate the following time value of money problems:
If you want to accumulate $500,000 in 20 years, how much do you need to deposit today that pays an interest rate of 15%?
What is the future value if you plan to invest $200,000 for 5 years and the interest rate is 5%?
What is the interest rate for an initial investment of $100,000 to grow to $300,000 in 10 years?
If your company purchases an annuity that will pay $50,000/year for 10 years at a 11% discount rate, what is the value of the annuity on the purchase date if the first annuity payment is made on the date of purchase?
What is the rate of return required to accumulate $400,000 if you invest $10,000 per year for 20 years. Assume all payments are made at the end of the period.
Calculate the project cash flow generated for Project A and Project B using the NPV method.
Which project would you select, and why?
Which project would you select under the payback method? The discount rate is 10% for both projects.
Use MicrosoftÂ® ExcelÂ® to prepare your answer.
Note that a similar problem is in the textbook in Section 5.1.
Sample Template for Project A and Project B:
Show all work.
Submit the memo and all calcluations.
Click the Assignment Files tab to submit your assignment.
Do you need a similar assignment done for you from scratch? We have qualified writers to help you. We assure you an A+ quality paper that is free from plagiarism. Order now for an Amazing Discount! Use Discount Code “Newclient” for a 15% Discount!NB: We do not resell papers. Upon ordering, we do an original paper exclusively for you.
The post i-need-help-with-my-fin-571-week-three-individual-assignment appeared first on Essay Fount.
What Students Are Saying About Us.......... Customer ID: 12*** | Rating: ⭐⭐⭐⭐⭐
"Honestly, I was afraid to send my paper to you, but you proved you are a trustworthy service. My essay was done in less than a day, and I received a brilliant piece. I didn’t even believe it was my essay at first 🙂 Great job, thank you!"
.......... Customer ID: 11***| Rating: ⭐⭐⭐⭐⭐
"This company is the best there is. They saved me so many times, I cannot even keep count. Now I recommend it to all my friends, and none of them have complained about it. The writers here are excellent."