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maw [93]
3 years ago
6

A project with an initial investment of $438,500 will generate equal annual cash flows over its 9-year life. The project has a r

equired return of 8 percent. What is the minimum annual cash flow required to accept the project
Business
1 answer:
motikmotik3 years ago
7 0

Answer:

$70 194.95

Explanation:

The computation of the minimal annual cash flow needed for accepting the project is shown below:

As we know that

Present value of annuity = Annuity × [1 - (1 + interest rate)^ - time period] ÷ rate

$438,500 = Annuity × [1 - (1.08)^ - 9] ÷ 0.08

$438,500 = Annuity × 6.246887911

So,

Annuity = $438,500 ÷ 6.246887911

= $70 194.95

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How do investment banks differ from commercial? banks? ?(mark all that? apply.)?
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