(Related to Checkpoint 11.1 and Checkpoint? 11.4) ?(Calculating NPV,? PI, and? IRR) ?Fijisawa, Inc. is considering...

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(Related to Checkpoint 11.1 and Checkpoint? 11.4) ?(CalculatingNPV,? PI, and? IRR) ?Fijisawa, Inc. is considering a majorexpansion of its product line and has estimated the following cashflows associated with such an expansion. The initial outlay wouldbe ?$11 comma 300 comma 000?, and the project would generate cashflows of ?$1 comma 150 comma 000 per year for 20 years. Theappropriate discount rate is 6.8 percent.
a. Calculate the NPV.
b. Calculate the PI.
c. Calculate the IRR.
d. Should this project be? accepted? Why or why? not?
a. The NPV of the expansion is ?$ ?(Round to the nearest?dollar.)
b. The profitability index of the expansion is ?(Round to twodecimal? places.)
c. The IRR of the expansion is ?(Round to two decimal?places.)
d. Should this project be? accepted? Why or why? not????(Selectfrom the? drop-down menus.)
yes or no because the NPV is positive or negative the IRR isgreater or less
than the required discount? rate, and the PI is greater or lessthan 1.

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3.8 Ratings (750 Votes)

NPV 1006382PI 11IRR 799Yes the project should be accepted since the NPV is positiveand IRR is greater than See Answer

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(Related to Checkpoint 11.1 and Checkpoint? 11.4) ?(CalculatingNPV,? PI, and? IRR) ?Fijisawa, Inc. is considering a majorexpansion of its product line and has estimated the following cashflows associated with such an expansion. The initial outlay wouldbe ?$11 comma 300 comma 000?, and the project would generate cashflows of ?$1 comma 150 comma 000 per year for 20 years. Theappropriate discount rate is 6.8 percent.a. Calculate the NPV.b. Calculate the PI.c. Calculate the IRR.d. Should this project be? accepted? Why or why? not?a. The NPV of the expansion is ?$ ?(Round to the nearest?dollar.)b. The profitability index of the expansion is ?(Round to twodecimal? places.)c. The IRR of the expansion is ?(Round to two decimal?places.)d. Should this project be? accepted? Why or why? not????(Selectfrom the? drop-down menus.)yes or no because the NPV is positive or negative the IRR isgreater or lessthan the required discount? rate, and the PI is greater or lessthan 1.