provide a specific anticipated rate of return.
6. What is the net present value of a project with an initial cost of $ 36,900 and cash inflows of $ 13,400, $ 21,600, and $ 10,000 for Years 1 to 3, respectively? The discount rate is 13 percent.
7. Maxwell Software, Inc., has the following mutually exclusive projects.
a-1. Calculate the payback period for each project.( Do not round intermediate calculations and round your answers to 3 decimal places, e. g., 32.161.)
Payback period Project A 1.938 years Project B 2.063 years ________________________________________
a-2. Which, if either, of these projects should be chosen?
b-1. What is the NPV for each project if the appropriate discount rate is 15 percent?( A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e. g., 32.16.)
b-2. Which, if either, of these projects should be chosen if the appropriate discount rate is 15 percent?
8. Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $ 2.82 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which it will be worthless. The project is estimated to generate $ 2,120,000 in annual sales, with costs of $ 815,000. The tax rate is 30 percent and the required return is 12 percent.
What is the project’ s NPV?( Do not round intermediate calculations and round your answer to 2 decimal places, e. g., 32.16.)
9. The Best Manufacturing Company is considering a new investment. Financial projections for the investment are tabulated here. The corporate tax rate is 35 percent. Assume all sales revenue is received in cash, all