Calculate the ae given a project with an outlay of -2000


Question: Need to complete some homework. full calculation process required.

1) Calculate the AE given a project with an outlay of -2000 and cash flows of 1500 per year for 5 years. The discount rate is 0.1. The rate is given as a decimal (eg .12 is 12%). Answer to the nearest dollar.

2)What is the present value of a series of payments of $4000 every three years in perpetuity with the first payment made immediately, if the annual rate is 10% per annum?

3)What is the incremental cash flow for a company that foregoes $8,000 pa in rental for factory space in order to mamnufacture a product that will return net cash inflows os $20,000 pa?

4) True or False? Please explain why.

In an efficient market on Ex-Dividend day the theoretical share price should fall by on average the amount of the dividend (assume no friction from taxes).

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Finance Basics: Calculate the ae given a project with an outlay of -2000
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