answer me correctly FIN 1013-2022W Assignment #2 Please read the following case study...
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FIN 1013-2022W Assignment #2 Please read the following case study carefully. Imagine you are working as an investment analysis for ABC Company, you are given 100,000$ to allocate for 5 different investment opportunities. You may select any combination of investments if the sum of initial cash outlays are equal to $100,000. Use NPV analysis in Excel to determine which out of these 5 Investments (or combination of) will be the most profitable. Provide an answer the following three questions in an Excel workbook. 1) If this $100,000 of capital is financed in the way shown below; calculate the WACC for this amount of capital. (corporate tax rate of 20%). Long term Loan 15,000$ @ 5% Short term Loan 5,000$ @ 8.5% Mortgage Loan 60,000$ @ 3% Equity 20,000$ @ 7% 2) Find out with single investment or combination of investments yields the highest NPV. Use Excel to calculate each --> You will be graded on your use of formulas in excel. 3) For each Investment option calculate the IRR (Internal Rate of Return). Option 1 A $25,000 initial investment which provides cash flows in the following way: Year 1 8,000$ Year 2 9,000$ Year 3 11,000$ Year 4 $12,000 Year 5 $8,500 Option 2 An annuity which provides payments of 7000$ at the end of year for 15 years. The initial investment is $75,000. Option 3 A $50,000 initial investment that provides cash flows in the following way: Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 2,000 $4,000 $8,000 $10,000 $12,000 $14,000 Year 7 $16,000 Option 4 A $50,000 initial investment that provides cash flows in the following way: Year 1 25,000 Year 2 $4,000 Year 3 $8,000 Year 4 $10,000 Year 5 $12,000 Year 6 $1,000 Year 7 $1,000 Option 5 A $100,000 Invesment which provides 5000$ per year for the first 5 years and then 10,000$ per year for an additional 9 years. FIN 1013-2022W Assignment #2 Please read the following case study carefully. Imagine you are working as an investment analysis for ABC Company, you are given 100,000$ to allocate for 5 different investment opportunities. You may select any combination of investments if the sum of initial cash outlays are equal to $100,000. Use NPV analysis in Excel to determine which out of these 5 Investments (or combination of) will be the most profitable. Provide an answer the following three questions in an Excel workbook. 1) If this $100,000 of capital is financed in the way shown below; calculate the WACC for this amount of capital. (corporate tax rate of 20%). Long term Loan 15,000$ @ 5% Short term Loan 5,000$ @ 8.5% Mortgage Loan 60,000$ @ 3% Equity 20,000$ @ 7% 2) Find out with single investment or combination of investments yields the highest NPV. Use Excel to calculate each --> You will be graded on your use of formulas in excel. 3) For each Investment option calculate the IRR (Internal Rate of Return). Option 1 A $25,000 initial investment which provides cash flows in the following way: Year 1 8,000$ Year 2 9,000$ Year 3 11,000$ Year 4 $12,000 Year 5 $8,500 Option 2 An annuity which provides payments of 7000$ at the end of year for 15 years. The initial investment is $75,000. Option 3 A $50,000 initial investment that provides cash flows in the following way: Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 2,000 $4,000 $8,000 $10,000 $12,000 $14,000 Year 7 $16,000 Option 4 A $50,000 initial investment that provides cash flows in the following way: Year 1 25,000 Year 2 $4,000 Year 3 $8,000 Year 4 $10,000 Year 5 $12,000 Year 6 $1,000 Year 7 $1,000 Option 5 A $100,000 Invesment which provides 5000$ per year for the first 5 years and then 10,000$ per year for an additional 9 years
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