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Question
Calculate the net present value for an investment project with the following cash flows using a 12 percent cost of capital:| Year | 0 | 1 | 2 | 3 |
| Net Cash Flow | $-100,000 | $80,000 | $80,000 | $-30,000 |
a. $56,560
b. $30,000
c. $13,840
d. cannot be determined with information given
Answer
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Related questions
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Q:
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Q:
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a. there are no transactions costs for buying and selling securities
b. relevant information is readily available for individuals and is costless to obtain
c. all investors can borrow and lend at the same rate
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b. the value of the firm is independent of its capital structure in perfect capital markets with no income taxes
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Q:
Borkstran has sales of $7.8 million, a variable cost ratio of 0.6, EBIT of $1.1 million, and a degree of combined leverage of 3.4. What is Borkstran's degree of financial leverage?
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Q:
Kenzel has an EPS of $4.20 and sales are $9 million. If the firm has a degree of operating leverage of 4.0 and a degree of financial leverage of 5.2, forecast EPS if the firm expects a 4% sales decline.
a. $0.71
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c. $4.03
d. $3.33