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Numerical Analysis Assignment

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User Generated
Subject
Numerical Analysis
School
Purdue Global University College
Type
Homework
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1. Current Attempt in Progress
The Management of Pharoah Manufacturing Company is evaluating two forklift systems
to use in its plant that produces the towers for a windmill power farm. The costs and the
cash flows from these systems are shown below. The company uses a 8 percent
discount rate for all projects.
Year 0
Year 1
Year 2
Otis Forklifts
$-3,107,450
$986,225
$1,356,886
Craigmore Forklifts
$-4,127,410
$880,236
$1,758,225
NPV
Otis forklift
$661,083
Craigmore Forklifts
$461,496
Compute the IRR for each of the two systems. (Round intermediate calculation to 0
decimal places, e.g. 1,525 and final answers to 2 decimal places, e.g. 15.10%.)
IRR
Otis forklift
enter percentages rounded to 2 decimal places
18
%
Craigmore Forklifts
enter percentages rounded to 2 decimal places
13.09
%
Is the investment decision different from the one determined by NPV?
The investment decision is select an option
different
from the one
determined by NPV.
Save for Later
Attempts: 0 of 2 used
2. Current Attempt in Progress
You are considering a project that has an initial outlay of $2.4 million. The profitability
index of the project is 2.74. What is the NPV of the project?

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NPV
$enter the NPV in dollars
4.176
Save for Later
3. Current Attempt in Progress
Blossom Solutions, Inc., has just invested $5,260,700 in new equipment. The firm uses
a payback period criteria of rejecting any project that takes more than four years to
recover its costs. Management anticipates cash flows of $647,800, $723,100, $840,100,
$1,228,300, $2,330,300, and $2,032,100 over the next six years. (Round answer to 2
decimal places, e.g. 15.25.)
What is the payback period of this investment?
Payback period is enter a number of years for the payback period rounded to 2 decimal places
4.78
years.
Should Blossom Solutions, Inc. go ahead with this project?
The firm select an option
should not accept
the project.
Save for Later
Attempts: 0 of 2 used
Submit Answer
4. Current Attempt in Progress
Blossom Incorporated management is considering investing in two alternative
production systems. The systems are mutually exclusive, and the cost of the new
equipment and the resulting cash flows are shown in the accompanying table. The firm
uses a 7 percent discount rate for production systems.
Year
System 1
System 2
0
-$12,730
-$44,975
1
12,745
30,140
2
12,745
30,140
3
12,745
30,140
Compute the IRR for both production system 1 and production system 2. (Do not round
intermediate calculations. Round answers to 2 decimal places, e.g. 15.25%.)

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1. Current Attempt in Progress The Management of Pharoah Manufacturing Company is evaluating two forklift systems to use in its plant that produces the towers for a windmill power farm. The costs and the cash flows from these systems are shown below. The company uses a 8 percent discount rate for all projects. Year 0 Year 1 Year 2 Year 3 Otis Forklifts $-3,107,450 $986,225 $1,356,886 $2,131,497 Craigmore Forklifts $-4,127,410 $880,236 $1,758,225 $2,855,110 NPV Otis forklift $661,083 Craigmore Forklifts $461,496 Compute the IRR for each of the two systems. (Round intermediate calculation to 0 decimal places, e.g. 1,525 and final answers to 2 decimal places, e.g. 15.10%.) IRR Otis forklift enter percentages rounded to 2 decimal places Craigmore Forklifts enter percentages rounded to 2 decimal places 18 % 13.09 % Is the investment decision different from the one determined by NPV? The investment decision is select an option determined by NPV. Save for Later different from the one Attempts: 0 of 2 used 2. Current Attempt in Progress You are considering a project that has an initial outlay of $2.4 million. The profitability index of the project is 2.74. What is the NPV of the project? NPV $enter the NPV in dollars 4.176 Save for Later 3. Current Attempt in Progress Blossom Solutions, Inc., has just invested $5,260,700 in new equipment. The firm uses a payback period criteria of rejecting any project that takes more than four years to recover its cost ...
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