Business, 14.02.2020 18:26 linnaefoos2183
OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship would cost $500 million but would operate for 20 years. OpenSeas expects annual cash flows from operating the ship to be $70.0 million and its cost of capital is 12.0%
a. Prepare an NPV profile of the purchase using discount rates of 2.0%, 11.5% and17.0%.
b. Identify the IRR on a graph.
c. Should OpenSeas go ahead with the purchase?
d. How far off could OpenSeas' cost of capital estimate be before your purchase decision would change? (NOTE: Subtract the discount rate from the actual IRR. Use Excel to compute the actual IRR.)
Answers: 2
Another question on Business
Business, 22.06.2019 07:00
Imagine you own an established startup with growing profits. you are looking for funding to greatly expand company operations. what method of financing would be best for you?
Answers: 2
Business, 22.06.2019 10:00
Frolic corporation has budgeted sales and production over the next quarter as follows. the company has 4100 units of product on hand at july 1. 10% of the next months sales in units should be on hand at the end of each month. october sales are expected to be 72000 units. budgeted sales for september would be: july august september sales in units 41,500 53,500 ? production in units 45,700 53,800 58,150
Answers: 3
Business, 22.06.2019 11:30
Mark knopf is an auditor who has been asked to provide an audit and financial statement certification for a company that is going public on the new york stock exchange. knopf wants to know his personal liability if the company provides him with inaccurate or false information. which of the following sources of law will him answer that question? a. the city ordinances where the company headquarters is located. b. the state constitution of the state where the company is incorporated. c. code of federal regulations. d. all of the above
Answers: 1
Business, 22.06.2019 12:30
True or false entrepreneurs try to meet the needs of the marketplace by supplying a service or product
Answers: 1
You know the right answer?
OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship would cost $500 million but...
Questions
Physics, 28.05.2020 03:59
Mathematics, 28.05.2020 03:59
Mathematics, 28.05.2020 03:59
Computers and Technology, 28.05.2020 03:59
Mathematics, 28.05.2020 03:59
Chemistry, 28.05.2020 03:59
