Company considering investing study

a) If a company is considering investing $200,000 in new equipment, for which the expected cash flows are as follows:CASH FLOWInitial outlay -$150,000Year 1 $50,000Year 2 $40,000Year 3 $30,000Year 4 $20,000Year 5 $20,000If the company has an 18% required rate of return, should this project be accepted?(b)A company must invest in either of the following two projects. Project A Project BInitial Outlay 0,000 $150,000Useful Life 5 years 5 yearsNet Present Value 130,000 $140,000If the required rate of return is 12% which project should the company accept?

2) ABC Ltd is considering two mutually exclusive projects. The with the projects are as follows:Year Project A Project B0 -$150000 -$150,0001 $45,000 $02 $45,000 $03 $45,000 $04 $45,000 $80,0005 $45,000 $200,000The required rate of return on these projects is 12%.(a)What is each projects payback period?(b)What is each projects net present value?(c)What is each projects internal rate of return?(d)What has ?(e)Which project should be accepted? Why?
3)Bathurst Copper Mine is experiencing a period of rapid growth due to demands from China. Earnings and dividends are expected to grow at a rate of 24% over the next two years, 16% in third year and then at a constant rate of 6% thereafter. Bathurst Copper Mines last dividend which has been paid was $1.15 If the required rate of return on the stock is 14%, what is the price of the stock today?

Don't use plagiarized sources. Get Your Custom Essay on
Company considering investing study
Just from $13/Page
Order Essay
Still stressed from student homework?
Get quality assistance from academic writers!
error: Content is protected !!
Open chat
1
Need assignment help? You can contact our live agent via WhatsApp using +1 718 717 2861

Feel free to ask questions, clarifications, or discounts available when placing an order.

Order your essay today and save 30% with the discount code LOVE