A4.(Investment Criteria)An investment of $100 returns exactly $100 in one year. The cost of capital is

A4.(Investment Criteria)An investment of $100 returns exactly $100 in one year. The cost of capital is

Corporate Financial Management (3rd Edition): Emery, Douglas R., Finnerty, John D., & Stowe, John D. (2007)

Individual assignment: Text Problem Set IV: Chapter 9, Problems

A4.(Investment Criteria)

A4. An investment of $100

A4.(Investment Criteria)An investment of $100 returns exactly $100 in one year. The cost of capital is 10%.

a. What are the payback, NPV, and IRR for this investment?

b. Is this a profitable investment?

Chapter 9 A4. (Investment criteria) An investment of $100 returns exactly $100 in one year. The cost of capital is 10%. SOLUTION