1. A company is evaluating all its investments using the internal rate of return method. If the required rate of return is 14%, should the company adopt the following investment plan? [Using Excel]
2. Let's say that the company uses the net-value method in the previous question. If the required rate of return is 11%, should the company adopt this investment? What if the required rate of return is 25%?
3. If the appropriate discount rate is 10% in the following cash flow, what is the profitability index? What if the discount rate is 15%? What if 22%?
4. There are two mutually exclusive investments, A and B,
A demand rate of 15% is required for which an investment plan is adopted.
a. When using the payback period method, which investment should be adopted? The reason is that?
b. When using the discount payback method, which investment should be adopted? The reason is that?
c. When using the net present value method, which investment should be adopted? The reason is that?
d. If an internal rate of return method is used, which investment should be adopted? The reason is that? [Using Excel]