1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Savatey [412]
3 years ago
15

Modern Federal Bank is setting up a brand-new branch. The cost of the project will be $1.2 million. The branch will create addit

ional cash flows of $235,000, $412,300, $665,000 and $875,000 over the next four years. The firm's cost of capital is 12 percent. What is the internal rate of return on this branch expansion
Business
1 answer:
KonstantinChe [14]3 years ago
3 0

Answer:

23.12%

Explanation:

Internal rate of return (IRR) is the rate at which the Net present value (NPV) of a project equals to zero.

Using a financial calculator and the CF function, input the following to find IRR;

Initial investment; CF0 = -1,200,000

Yr1 cashflow inflow ; C01 = 235,000

Yr2 cashflow inflow ; C02 = 412,300

Yr3 cashflow inflow ; C03 = 665,000

Yr4 cashflow inflow ; C04 = 875,000

Then key in IRR CPT = 23.119%

Therefore, the Internal rate of return this expansion is 23.12%

You might be interested in
A firm has determined its cost of each source of capital and its optimal capital structure which is comprised of the following s
barxatty [35]

Answer:

10.25%

Explanation:

Data provided in the question:

Long-term debt = 45%, after-tax cost = 7%

Preferred stock = 15%, after-tax cost = 10%

Common stock equity = 40%, after-tax cost = 14%

Now,

The  weighted average cost of capital for this firm will be calculated as:

= Long term debt × after-tax cost + Preferred stock × after-tax cost + Common stock equity × after-tax cost

or

= 0.45 × 0.07 + 0.15 × 0.10 + 0.40 × 0.14

or

= 0.0315 + 0.015 + 0.056

= 0.1025

or

= 0.1025 × 100%

= 10.25%

5 0
3 years ago
Daisy Inc., a manufacturing company, is planning to invest in newequipment. Thomas, the cost accounting manager, was in favor as
NeX [460]

Answer:

The correct answer is D. Credibility.

Explanation:

Thomas violated the credibility of his studies, because he omitted the error which caused a false expected result.

Credibility is that characteristic of certain things that make them credible, we talk about situations, verses or estimates of a certain presence. When we say that we observe the credibility of something we are making a measurement of what is credible and not facing a series of examples in order to make a comparison in this regard.

7 0
3 years ago
During hyperinflation, the value of money: Multiple choice question. falls slowly rises slowly does not change falls rapidly ris
Vinil7 [7]

The value of money grows fast during hyperinflation.

Hyperinflation is defined by fast and unrestricted price rises in an economy, generally at rates greater than 50% per month over time. In times of war and economic turbulence in the underlying manufacturing sector, along with a central bank creating an excessive quantity of money, hyperinflation can arise.

As essential items such as food and gasoline become limited, hyperinflation can cause price increases.

While hyperinflations are uncommon, once they start, they may quickly spiral out of control.

Therefore, the correct option is rises rapidly.

To know more about hyperinflation click here:

brainly.com/question/1297747

#SPJ4

8 0
2 years ago
A person is completing a Form U4 to become registered and notices that the document requires his signature. The person has an av
Olin [163]

Answer:

Explanation:

If an individual signs Form U4, that individual is agreeing to submit potential disputes with the firm, other member firms, customers, or associated persons to arbitration rather than litigation . In other words, the individual is agreeing to use arbitration as a means of resolving any disputes that involve the employer, other members, customers, or associated persons. instead of litigation. This form is mandatory and must be signed by any individual who is registering with a broker-dealer.

5 0
3 years ago
A vending machine dispenses hot chocolate or coffee. Service time is 20 seconds per cup and is constant. Customers arrive at a m
Leni [432]

The answer & explanation for this question is given in the attachment below.

7 0
3 years ago
Other questions:
  • What is the practice of banks and mortgage lenders identifying high-risk areas (usually low-income or minority neighborhoods) an
    13·1 answer
  • What is the economic problem
    8·1 answer
  • You have just won ​$20,000 in the state​ lottery, which promises to pay you ​$1,000​ (tax free) every year for the next twenty y
    15·1 answer
  • Ford Motor Company is introducing consumers to its new car with the help of an advertisement campaign. This introductory campaig
    5·1 answer
  • It’s important to know whether you’ve paraphrased and cited source material for your paper correctly so you avoid plagiarism. Re
    7·1 answer
  • Southern Foods just paid an annual dividend of $2.10 a share. Management estimates the dividend will increase by 11 percent a ye
    12·1 answer
  • Sweet Dreams Chocolatiers Ltd. began operations on January 1, 2020. During its first year, the following transactions occurred:
    6·1 answer
  • Opera Estate Girls' School is considering increasing its tuition to raise revenue.
    5·1 answer
  • Using advances in technology to maintain databases of customer information is more important for firms involved in mass marketin
    12·1 answer
  • I rlly need answers quick guys! This isnt Business tho!
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!