ooo AT&T; LTE 10:43 AM Back Detail Submission Grade If the company had $10,000,0

Question

ooo AT&T; LTE 10:43 AM Back Detail Submission Grade If the company had $10,000,000 in cash right now that is earning a consistent 8% compounded per year, how much interest would the company forego over the next 10 years if it used the $10,000,000 to pay cash for the project? Hint: What is the future value of $10,000,000 invested today at 8%? If the company expects annual net income to increase by $2,000,000 because of the project, compute the payback period, ignoring the time value of money. What is the present value of the $2,000,000 annual increase in net income over the next 10 years assuming a discount rate of 8%? Hint: What is the Previous Next Courses Calendar Todo Notifications Messages

Explanation / Answer

Payback period=10000000/2000000= 5 years

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