Question 1
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The financial manager is evaluating a proposal for a new project with a cost of capital of 13.5%.
The cash flows for the project are estimated as follows:
Year Net cash flows
0 -R 1 000 000
1 R 65...
, Started on Thursday, 5 September 2024, 8:02 AM
State Finished
Completed on Thursday, 5 September 2024, 8:11 AM
Time taken 9 mins 12 secs
Question 1
Complete
Marked out of 1.00
Flag question
Question text
The financial manager is evaluating a proposal for a new project with a cost of capital of 13.5%.
The cash flows for the project are estimated as follows:
Year Net cash flows
0 -R 1 000 000
1 R 650 000
2 R 450 000
3 R 350 000
The IRR is ...
a.
12.03%
b.
17.04%
c.
20.05%
d.
24.03%
Question 2
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Calculate the difference between the following two investment proposals.(a) R1 401.82 invested
annually for five successive years at 9% per annum.(b) R5 209.22 invested for five years at 10% per
annum compound interest.
a.
R0
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