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##### Net Present Value of the following Cash Flows

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Question 1;What is the net present value of the following cash flows? Assume an interest rate of 2.03%;Year CF;0 -\$12,387;1 \$7,180;2 \$5,224;3 \$9,399;Question 2;Consider a taxable bond with a yield of 10.6% and a tax-exempt municipal bond with a yield of 4.4%. At what tax rate would you be indifferent between the two bonds?;Question 3;In its most recent financial statements, ABC reported \$55,004 of net income and \$609,459 of retained earnings. The previous retained earnings were \$621,318. How much in dividends was paid to shareholders during the year?;Question 4;ABC Company earned \$856,962 in taxable income for the year. How much tax does the company owe on this income?;Question 5;ABC Company has a debt-equity ratio of 0.66. What is the debt ratio?;Question 6;A project has the following cash flows. What is the internal rate of return?;Year 0 1 2 3;Cash flow -\$121,000 68,150 \$42,200 \$39,100;14.82%;14.39%;13.47%;13.85%;12.71%;Question 7;Your firm has the following balance sheet statement items: total current liabilities of \$325,000, total assets of \$3,655,000, fixed and other assets of \$1,770,000, and long-term debt of \$200,000.;What is the amount of the firm?s net working capital?;\$1,685,000;\$325,000;\$1,080,000;\$1,885,000;\$1,560,000;Question 8;ABC Company offers a perpetuity which pays annual payments of \$9,478. This contract sells for \$276,415 today. What is the interest rate?;Question 9;A firm has a return on equity of 33.9 percent, a net profit margin of 8.4 percent, and total equity of \$733.9. What is the net income?;Question 10;ABC Company lists total assets of \$4,238, current liabilities of \$271, long-term debt of \$903, and 309 shares of common stock. If the market price per share is \$60, what is the market-to-book ratio?;Question 11;Suppose an investment offers to double your money in 30 years. What annual rate of return are you being offered if interest is compounded semi-annually?;Question 12;Suppose you invest \$49,200. If the interest rate is 12% compounded quarterly for the first 10 years and 12% compounded monthly for the next 5 years, what is the future value after 15 years?;Question 13;ABC is reviewing a project that will cost \$2,099.The project will produce cash flows \$702 at the end of each year for the first two years and \$707 at the end of each year for the next three years. What is the profitability index? Assume interest rate is 6%.;Question 14;Debbie wants to have \$64,459 in her bank account 4 years from now. The account will pay 0.9% interest per month. How much money does she need to put in her bank account at the end of each month to achieve this goal?;Question 15;Calculate the NPV of a project that requires investment of 681 and provides the cashflows of 390, 318, 316, 364 in the next 4 years. The relevant discount rate is 14%. (All numbers are in dollars);Question 16;Find the payback period for a project that requires investment of \$30 and returns \$11 every years for 7 years.;Question 17;Calculate the project's IRR.;Year;0;1;2;3;4;Cash flows;?\$1,050;\$400;\$400;\$400;\$400

Paper#79981 | Written in 18-Jul-2015

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