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Lesson 2 Chapter 2 Homework × re http://newconnect.rnheducationc Ia search Lesso

ID: 2334104 • Letter: L

Question

Lesson 2 Chapter 2 Homework × re http://newconnect.rnheducationc Ia search Lesson 2 Chapter 2 Homework Saved Help Save & Exit Subn Check my work 8 EX2-5 (Algo) You are the head of the project... 769 points You are the head of the project selection team at SIMSOX. Your team is considering three different projects. Based on past history, SIMSOX expects at least a rate of return of 24 percent Given the following information for each project, which one should be SIMSOX first priority? Should SIMSOX fund any of the other projects? (Use the NPV function in Excel to solve this problem.) Project Dust Devils eBook wwYear Investment Revenue Stream S90,000 55,000 295, 000 395, 000 Project: Ospry Year Investment Revenue Stream 340,000 46,000 46, 000 46,000 Project Voyagers Year Investnment Revenue seresn 33,000 25, 000 68.000 59, 000 141,000 The NPV for Dust Dedls is The NPy for Ospry is The NPV for Voyagers is C Prev8 of 13 Next>

Explanation / Answer

Project : Dust devils

Year

Investment

Cash inflow

Pv factor

NPV

0

-590000

-590000

1

55000

0.833

45815

2

295000

0.694

204730

3

395000

0.579

228705

-110750

Project: Ospry

Year

Investment

Cash inflow

Pv factor

NPV

0

-340000

-340000

1

46000

0.833

38318

2

46000

0.694

31924

3

46000

0.579

26634

4

83000

0.482

40006

-203118

Project : Voyagers

Year

Investment

Cash inflow

Pv factor

NPV

0

-93000

-93000

1

33000

0.833

27489

2

25000

0.694

17350

3

68000

0.579

39372

4

59000

0.482

28438

5

141000

0.402

56682

76331

NPV of Dust devils

-110750

NPV of Ospry

-203118

Npv of Voyagers

76331

Project : Dust devils

Year

Investment

Cash inflow

Pv factor

NPV

0

-590000

-590000

1

55000

0.833

45815

2

295000

0.694

204730

3

395000

0.579

228705

-110750

Project: Ospry

Year

Investment

Cash inflow

Pv factor

NPV

0

-340000

-340000

1

46000

0.833

38318

2

46000

0.694

31924

3

46000

0.579

26634

4

83000

0.482

40006

-203118

Project : Voyagers

Year

Investment

Cash inflow

Pv factor

NPV

0

-93000

-93000

1

33000

0.833

27489

2

25000

0.694

17350

3

68000

0.579

39372

4

59000

0.482

28438

5

141000

0.402

56682

76331

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