\napter 10 + Capital-Sudgerg 30-7. Wavtack period calculations) You are considering three independent projects, project A, Hite B, and project C, Given the following cash-flow informanion, calculate the payback period lor cach, : e Prosecr A PROJECT & PRoECTC Initial outlay SIO a BIOBOO So sga0o Inflow year 1 600 5.000 1.000 Inflow year 2 300 3.000 1,000 Inflow year 3 200 3,000 2008 Inflow year 4 100 3,000 2006 Inflow year 5 500 3,000 2.006 If vou require a 3 * payback before an investment can be accepted, which project(s) would be accepted? 10-8. (NPY scith varying required rates of return) Gubanich Spostsweat is considering building 2 Rew factory to produce aluminum baseball bats, This project would require an initial ex é $5,060,000 and will generate annual free cash inflows of $1,000,000 pet year for 8 years, the project’s NPV’ given: a. A required rate of return of 9 percent b. A required rate of return of 11 percerit ©. A requived rate of return of 13 percent d. A required rate of return of 15 percent 10-9. (IRR calculations) Given the following free cash flows, determine the IRR for the three inde pendent projects A, B, and C. PROJECTA PROJECT B PROJECT C * Initial outlay $50,000 $100,000 $450,000 Cash inflows: Year ‘ $10,000 $125,000 $200,000 Year 2 : 15,000 25,000 200,000 Year3- 20,000 25,000 200,000 Year4 25,000 25,000 - Year 5 30,000 25,000 =