Initial Investment Cash flowProject A $35 million $14 million per year for four yearsProject B $21 million $7 million per year for five years Project C $14 million $7 million per year for four years Project D $21 million $10.5 million per year for three years An investor has a budget of $35 million. He can invest in the projects shown above. If the cost of capital is 8%, what investment or investments should he make?
A: Project A
B: Project B
C: Project B and Project C
D: Project C and Project D
A: Project A
B: Project B
C: Project B and Project C
D: Project C and Project D
举一反三
- A company is considering entering into a joint venture that will require an investment of $30 million. The project is expected to generate cash flows of $7 million, $14 million, and $15 million in each of the next three years, respectively. Assuming a discount rate of 7%, what is the project"s NPV A: -$5343200 B: -$3702900 C: +$1563400
- A company is considering entering into a joint venture that will require an investment of $15 million. The project is expected to generate cash flows of $9 million and $8 million in each of the next two years, respectively. What is the project"s IRR A: 9% B: 14% C: 15%
- Year 1 2 3 4Free Cash Flow $12 million $18 million $22 million $26 millionConundrum Mining is expected to generate the above free cash flows over the next four years, after which they are expected to grow at a rate of 6% per year. If the weighted average cost of capital is 12% and Conundrum has cash of $80 million, debt of $60 million, and 30 million shares outstanding, what is Conundrum's expected terminal enterprise value at year 4? A: $413.4 million B: $459.3 million C: $505.3 million D: $528.2 million
- The gain from a<br/>project is equally likely to have any value between -$0.15 million<br/>and +$0.85 million. What is the 99% expected shortfall? ( ) A: $0.145 million B: $0.14 million C: $0.13 million D: $0.10 million
- Last year, a certain public transportation system sold an average (arithmetic mean) of 41,000 tickets per day on weekdays (Monday through Friday) and an average of 18,000 tickets per day on Saturday and Sunday. Which of the following is closest to the total number of tickets sold last year A: 1 million B: 1.25 million C: 10 million D: 12.5 million E: (E) 125 million