Sunday, April 19, 2015

PV and IRR questions

A. Assume the following cash flows:

1. 5,655
2. 4,434
3. 6,000
4. 7,800
5. 80,000

1. What should I pay if my target is an 8.0% rate of return?

2. What should I pay if my target is an 12.0% rate of return?

3. What should I pay if my target is an 10.0% rate of return?


B. Assume the following cash flows:

1. 5,000
2. 6,000
3. 7,000
4. 6,000
5. 90,000

 4. If I paid 100,000, what would be the rate of return?

5. If I paid 70,000, what would be the rate of return?

6. If I paid 50,000, what would be the rate of return?

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