Robbins Inc. is considering a project that has the following cash flow and cost of capital...

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Finance

Robbins Inc. is considering a project that has the followingcash flow and cost of capital (r) data. What is the project's NPV?Note that if a project's expected NPV is negative, it should berejected.
r. 10.25%
Year
0
1
2
3
4
5
Cash flows
âˆ’$1,000
$300
$300
$300
$300
$300
a. $105.89
b. $111.47
c. $117.33
d. $123.51
e. $130.01
Reed Enterprises is considering a project that has the followingcash flow and cost of capital (r) data. What is the project's NPV?Note that a project's expected NPV can be negative, in which caseit will be rejected.
r. 10.00%
Year
0
1
2
3
Cash flows
âˆ’$1,050
$450
$460
$470
a. $112.28
b. $92.37
c. $101.84
d. $106.93
e. $96.99
Spence Company is considering a project that has the followingcash flow data. What is the project's IRR? Note that a project'sIRR can be less than the cost of capital or negative, in both casesit will be rejected.
Year
0
1
2
3
4
Cash flows
âˆ’$1,050
$400
$400
$400
$400
a. 21.20%
b. 15.61%
c. 19.27%
d. 17.34%
e. 14.05%

Answer & Explanation Solved by verified expert

4.5 Ratings (981 Votes)

Calculating NPV for Project of Robbins IncDiscount rate Cost of capital r 1025We have the following cash flowsCash FlowYear012345Cash Flow1000300300300300300We know that present value of a cash flow Cash flow 1discount raten where n year of cash flowNPV of the project Cash flow in year 0 Sum of present valueof cash flows for year 1 to year 5 See Answer

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r.	10.25%
Year	0	1	2	3	4	5
Cash flows	âˆ’$1,000	$300	$300	$300	$300	$300