Unformatted text preview: Truck: NPV = $17,100 + $5,100(PVIFA 14%,5 ) = $17,100 + $5,100(3.4331) = $17,100 + $17,509 = $409. (Accept) Financial calculator: Input the appropriate cash flows into the cash flow register, input I = 14, and then solve for NPV = $409. Financial calculator: Input the appropriate cash flows into the cash flow register and then solve for IRR = 14.99% ≈ 15%. (Accept) Pulley: NPV = $22,430 + $7,500(3.4331) = $22,430 + $25,748 = $3,318. (Accept) Financial calculator: Input the appropriate cash flows into the cash flow register, input I = 14, and then solve for NPV = $3,318. Financial calculator: Input the appropriate cash flows into the cash flow register and then solve for IRR = 20%. (Accept) According to the NPV rule we accept projects with NPV ≥ 0 According to the IRR rule, we accept projects if the IRR is greater than the cost of capital....
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 Spring '10
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