A firm’s cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of… – savvyessaywriters.net | Savvy Essay Writers
A firm’s cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of… – savvyessaywriters.net | Savvy Essay Writers
Savvy Essay Writers Business & Finance Assignment Help
A firm’s cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of each are as follows:Cash InflowsA B CYear 1 $395 — $1,2412 395 — –3 395 — –4 — $1,749 –Each investment requires a $1,000 cash outlay, and investments B and C are mutually exclusive.a. Which investment(s) should the firm make according to the net present values? Why?b. Which investment(s) should the firm make according to the internal rates of return? Why?c. If all funds are reinvested at 15 percent, which investment(s) should the firm make? Would your answer be different if the reinvestment rate were 12 percent?A risky $400,000 investment is expected to generate the following cash flows: Year 1 2 3 4 $145,300 $175,445 $156,788 $145,000 A. If the firm’s cost of capital is 10 percent, should the investment be made? B. An alternative use for the $400,000 is a four-year U.S. Treasury bond that pays $28,000 annually and repays the $400,000 at maturity. Management believes that the cash inflows from the risky investment are equivalent to only 75 percent of the certain investment, which pays 7 percent. Does this information alter the decision in a?FinanceBudget25.00Attach Files For This ProjectWarning: Attaching a file will overwrite the existing fileChat With ScholarsContact Ace SupportInvite Scholars To BidClick “Select” to assign work to scholarHow to assign work to a scholarSelect as WinnerScholarLevelRatingMessage ScholarAmount ($)Expected Completion (MST)Original GuaranteeyeswritingChat Now!Veteran Scholarout of 17 reviews25.0006/21/2014 12:00 amYassignmentexpert96Chat Now!Veteran Scholarout of 13 reviews40.0006/21/2014 12:00 amYGet Ace Help Fast By Upgrading Project (Optional)Cancel ProjectFacebook Fan PageAnnouncements
Team of Professional Essay Writers
Savvyessaywriters.net is a trusted essay service that connects learners seeking assistance with top-ranked experts. Every essay writer on our team has a unique rating based on the percentage of successful orders and customer reviews. Check out our pros’ profiles to hire the most suitable one.
