Use the information below to answer Question#40: GIVEN: The XYZ Company is considering the following project with its corresponding financial data. The Company requires a 9% return from its...


Use the information below to answer Question#40:<br>GIVEN: The XYZ Company is considering the following project with its corresponding financial data.<br>The Company requires a 9% return from its investments.<br>$ 500,000<br>$ 200,000<br>$ 225,000<br>$ 245,000<br>Initial investment:<br>Expected Cash in-flow Year 1:<br>Expected Cash in-flow Year 2:<br>Expected Cash in-flow Year 3:<br>Present Value Factor of 1 at 9%:<br>n=1: 0.91743<br>n=2: 0.84168<br>n=3: 0.77218<br>40) Choose from one of the following that accurately depicts this decision:<br>A) This investment should not be considered because NPV is a negative $62,048<br>B) This învestment should be considered because NPV equals positive $62,048<br>C) This investment should be considered because the IRR for this investment is obviously<br>less than its Required Rate of Return<br>D) B and Care both correct<br>

Extracted text: Use the information below to answer Question#40: GIVEN: The XYZ Company is considering the following project with its corresponding financial data. The Company requires a 9% return from its investments. $ 500,000 $ 200,000 $ 225,000 $ 245,000 Initial investment: Expected Cash in-flow Year 1: Expected Cash in-flow Year 2: Expected Cash in-flow Year 3: Present Value Factor of 1 at 9%: n=1: 0.91743 n=2: 0.84168 n=3: 0.77218 40) Choose from one of the following that accurately depicts this decision: A) This investment should not be considered because NPV is a negative $62,048 B) This învestment should be considered because NPV equals positive $62,048 C) This investment should be considered because the IRR for this investment is obviously less than its Required Rate of Return D) B and Care both correct

Jun 07, 2022
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