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COMM5005 Week 4 Tuts210

# COMM5005 Week 4 Tuts210 - (b If the cost of the project A...

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COMM5005 Week 4 Tutorial Questions Questions 1-11 below come from the Haeussler Paul and Wood textbook. Question HPW Page Section Problem 1 200 5.1 7 2 201 5.1 17 3 201 5.1 27 4 205 5.2 16 5 205 5.2 18 6 205 5.2 23 7 207 5.3 6 8 208 5.3 14 9 208 5.3 19 10 216 5.4 22 11 217 5.4 32 12 You are offered two investment opportunities. Project A will return \$152,365 after 30 months. Project B will return \$155,495 after 36 months. (a) If interest is 5% p.a. compounded monthly, which opportunity has the higher return in current dollars?
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Unformatted text preview: (b) If the cost of the project A is \$75,000 and project B is \$77,000 what are the net present values of the two projects? 13 A project will result in a return of \$600,000 after three years and a further \$470,000 return after five years. (a) If interest is 6.5% p.a. compounded monthly what is the current value of the combined returns? (b) If the project costs \$720,000 to set up now, make an estimate of the internal rate of return using a trial and error method on your calculator. Then find the actual IRR using Excel....
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