Warren Lynch at CompU has calculated the cash flows for the advertising campaign, and now has...

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Finance

Warren Lynch at CompU has calculated the cash flows for theadvertising campaign, and now has to decide whether the ad campaignwill generate more cash flows than its cost. The cash flows for thecampaign are as follows. CompU’s cost of capital is 9%.
Initial Investment: $110,000
Operating Cash Flows by year:
Year                Cash Flows
1                     $35,000
2                     $39,800
3                     $34,600
4                     $31,800
5                     $31,800
Calculate the payback period of the ad campaign.
Calculate the net present value of the campaign.
Calculate the internal rate of return of the campaign. Shouldthe campaign be accepted?
CellU, a subsidiary of CompU, is looking to replace one of themachines they use to manufacture cell phones with a new, moreefficient model. The incremental cash flows of the new machine areas follows. CellU’s cost of capital is 11%.
Initial Investment: $12,190
Operating Cash Flows by year:
Year                Cash Flows
1                     $4,974
2                     $5,760
3                     $4,320
Calculate the payback period of the new machine.
Calculate the net present value of the new machine.
Calculate the internal rate of return of the new machine.Should the machine be accepted?

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Warren Lynch at CompU has calculated the cash flows for theadvertising campaign, and now has to decide whether the ad campaignwill generate more cash flows than its cost. The cash flows for thecampaign are as follows. CompU’s cost of capital is 9%.Initial Investment: $110,000Operating Cash Flows by year:Year Cash Flows1 $35,0002 $39,8003 $34,6004 $31,8005 $31,800Calculate the payback period of the ad campaign.Calculate the net present value of the campaign.Calculate the internal rate of return of the campaign. Shouldthe campaign be accepted?CellU, a subsidiary of CompU, is looking to replace one of themachines they use to manufacture cell phones with a new, moreefficient model. The incremental cash flows of the new machine areas follows. CellU’s cost of capital is 11%.Initial Investment: $12,190Operating Cash Flows by year:Year Cash Flows1 $4,9742 $5,7603 $4,320Calculate the payback period of the new machine.Calculate the net present value of the new machine.Calculate the internal rate of return of the new machine.Should the machine be accepted?