Lesson #5, Assignment #2 - 1.15 =NPV(D19,D9:D17)/-D8 NPV...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 9 Bullock Gold Mining Input area: Year Cash flow 0 $(600,000,000) 1 $75,000,000 2 $120,000,000 3 $160,000,000 4 $210,000,000 5 $240,000,000 6 $160,000,000 7 $130,000,000 8 $90,000,000 9 $(95,000,000) Required return 12% Output area: Question 1: Payback period 4.15 IRR 16.04% =IRR(D8:D17) IRR Err:523 =IRR(D8:D17,-0.99) MIRR 13.63% =MIRR(D8:D17,D19,D19) Profitability index
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 1.15 =NPV(D19,D9:D17)/-D8 NPV $88,111,548.04 =NPV(D19,D9:D17)+D8 Question 2: Based on your analysis, should the company open the mine? Since the NPV of the mine is positive, the company should open the mine. It may be advantageous to delay the mine opening because of real options....
View Full Document

This note was uploaded on 04/29/2011 for the course FINANCE BA521 taught by Professor Mark during the Spring '11 term at Antelope Valley College.

Ask a homework question - tutors are online