FIN 419 Expect Success/uophelp.com FIN 419 Expect Success/uophelp.com | Page 26

What is EBIT-EPS analysis?
What is the indifference curve?
How is risk factored into the EBIT-EPS analysis?
What are the “basic short comings” of EBIT’s analyses?
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FIN 419 Week 4 Individual My FinanceLab (New)

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P9-7
Net present value.
Quark Industries has a project with the following projected cash
flows:
a.
Using a discount rate of 9%
for this project and the NPV model, determine whether the company
should accept or reject this project.
b.
Should the company accept or reject it using a discount rate of
17%?
c.
Should the company accept or reject it using a discount rate of
18%?
P9-8 (similar to)
Net present value. Lepton Industries has a project with the following
projected cash flows:
Initial cost: $470,000
Cash flow year one: $121,000
Cash flow year two: $260,000
Cash flow year three: $181,000
Cash flow year four: $121,000