Gold Miners Inc is considering an gold extraction project that requires an initial investment of $211,020 and will yield annual cash inflows of $60,000 for five years. The company's minimum rate of return rate 14%. The internal rate of return for this project is n/i 1 2 3 4 5 n/i 1 2 3 4 5 Present Value of an $1 12% 13% 14% 15% 0.893 0.885 0.877 0.87 0.797 0.783 0.769 0.756 0.712 0.693 0.675 0.658 0.636 0.613 0.592 0.572 0.497 0.567 0.543 0.519 Present Value of an Ordinary Annuity 12% 13% 14% 0.893 0.885 0.877 1.69 1.668 1.647 2.402 2.361 2.322 3.037 2.974 2.914 3.605 3.517 15% 0.87 1.626 2.283 2.855 3.433 3.352 %.
Gold Miners Inc is considering an gold extraction project that requires an initial investment of $211,020 and will yield annual cash inflows of $60,000 for five years. The company's minimum rate of return rate 14%. The internal rate of return for this project is n/i 1 2 3 4 5 n/i 1 2 3 4 5 Present Value of an $1 12% 13% 14% 15% 0.893 0.885 0.877 0.87 0.797 0.783 0.769 0.756 0.712 0.693 0.675 0.658 0.636 0.613 0.592 0.572 0.497 0.567 0.543 0.519 Present Value of an Ordinary Annuity 12% 13% 14% 0.893 0.885 0.877 1.69 1.668 1.647 2.402 2.361 2.322 3.037 2.974 2.914 3.605 3.517 15% 0.87 1.626 2.283 2.855 3.433 3.352 %.
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 19EA: Redbird Company is considering a project with an initial investment of $265,000 in new equipment...
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Transcribed Image Text:Gold Miners Inc is considering an gold extraction project that requires an initial investment of
$211,020 and will yield annual cash inflows of $60,000 for five years. The company's
minimum rate of return rate 14%. The internal rate of return for this project is
n/i
1
2
3
4
5
n/i
1
2
3
4
5
Present Value of an $1
12%
13%
14%
15%
0.893 0.885
0.877
0.87
0.797 0.783
0.769
0.756
0.712 0.693 0.675
0.658
0.636 0.613 0.592 0.572
0.567 0.543 0.519 0.497
Present Value of an Ordinary Annuity
12%
13%
14%
15%
0.893 0.885 0.877
0.87
1.69
1.668
1.647
1.626
2.402
2.361
2.322 2.283
3.037
2.974
2.914
2.855
3.605
3.517 3.433 3.352
%.
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