Investment B: 0 -$1 million 1 $550,000 2 $400,000 3 $325,000 The timeline of an investment is shown above. If the cost of capital is 8%, a) What is the Net Present Value (NPV) of this investment? b) Calculate the Modified Internal Rate of Return (MIRR) of this investment

A labor saving device system save $2,000 per year for five (5) years. It can be installed at a cost of $8,000. The rate of return on this planned investment is most nearly:   a. = 12.36%   b. = 9.36%   c. 10%   d. i = 8%

1. XYZ company planned that $500,000 be spent on software and hardware to improve the efficiency of the database systems. This is expected to save $10,000 per year for 10 years in energy costs and $700,000 at the end of 10 years in equipment costs. a) Write the required equation for finding the rate of return by using factors. (You are not expected to find the rate of return value) b) Calculate the rate of return by using Excel.

Suppose a bank offers you the following two year, non-cashable GICs (i.e., withdrawals are not allowed). The first one pays a monthly rate of return 0.245%, the second one pays a semi-annual rate of return of 1.47% and the third one a return of 2.75% for the first year and 3.25% for the second year. All interest payments are reinvested.(a) Which investment would you prefer?(b) Suppose you expect that interest rates decline to 3% after the first year. How does your answer change, if the two year GIC pays out the first interest payment (but not the principal) at the end of the first year?