You are considering a project with an initial cash outlay of $100,000 and expected free cash flows...

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Finance

You are considering a project with an initial cash outlay of$100,000 and expected free

cash flows of $23,000 at the end of each year for 6 years. Therequired rate of return for this

project is 10 percent.

a. What is the project’s payback period?

b. What is the project’s discounted payback period?

c. What is the project’s NPV ?

d. What is the project’s PI ?

e. What is the project’s IRR ?

f. What is the project’s MIRR if the re-investment rate is 10percent?

g. What is the project’s MIRR if the re-investment rate is 12percent?

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Transcribed Image Text

You are considering a project with an initial cash outlay of$100,000 and expected freecash flows of $23,000 at the end of each year for 6 years. Therequired rate of return for thisproject is 10 percent.a. What is the project’s payback period?b. What is the project’s discounted payback period?c. What is the project’s NPV ?d. What is the project’s PI ?e. What is the project’s IRR ?f. What is the project’s MIRR if the re-investment rate is 10percent?g. What is the project’s MIRR if the re-investment rate is 12percent?

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