Payback for new dialysis unit

by | Nov 17, 2021 | Homework Help

a.Determine the payback for the new dialysis unit.by Determine the NPV using a cost of capital of 15 percent.Determine the NPV at a cost of capital of 20 percent and compute the IRR.d. At a 15 percent cost of capital, should the project be accepted? At a 20 percent costof capital, should the project be accepted? Explain.13. St. Rose Hospital expects Projects A and B to generate the following cash flows.Givens (in ‘Doos)YearsInitial investment045Net operating cash flows for Project A($3,500)Net operating cash flows for Project B$2,500, $2,000 $1,500 $1,000$600$600 $1,000 $1,500 $2,000 52.500a."Determine the NPV for both projects using a cost of capital of 20 percent.b. Determine the NPV for both projects using a cost of capital of 10 percent.c. At a 10 percent cost of capital, which project should be accepted? At a 20 percentcost of capital, which project should be accepted? Explain.14. Valley Care Medical Center expects Projects X and Y to generate the following cash flows:Givens (in ‘000s)Years012 345Initial investmentNet operating cash flows for Project X(57,500)$7,000 $5,000 $3,000 $2,000 $1,500Net operating cash flows for Project Y$1,500 $2,000 $3,000 $5,000 $7,000a.Determine the NPV for both projects using a cost of capital of 17 percent.b. Determine the NPV for both projects using a cost of capital of 12 percent.c. At a 12 percent discount rate, which project should be accepted? At a 17 percentdiscount rate, which project should be accepted? Explain.15. Kaiser Oakland Practice expects Projects 1 and 2 to generate the following cash flows:Project 1 (in ‘000s)GivensYears01!23451 Initial investment($2,800)2Net operating cash flows$300$500$800$1,200$2,000Project 2 (in ‘000s)GivensYears12345NInitial Investment($5,000)Net operating cash flows$1,300 $1,300$1,300$1,300$1,300a. Determine the payback for both projects.b. Determine the IRR.c. Determine the NPV at a cost of capital of 12 percent.

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