罗斯公司理财第六版习题答案

Chapter6:SomeAlternativeInvestmentRulesConceptQuestions-Chapter66.2*ListtheproblemsofthepaybackperiodruleItdoesnottakeintoaccountthetimevalueofmoney.Itignorespaymentsafterthepaybackperiod.Thecutoffperiodisarbitrary.*Whataresomeadvantages?Itissimpletoimplement.Itmayhelpincontrollingandevaluatingmanagers.6.4*WhatarethethreestepsincalculatingAAR?Determineaveragenetincome.DetermineaverageinvestmentDivideaveragenetincomebyaverageinvestment.*WhataresomeflawswiththeAARapproach?Itusesaccountingfigures.Ittakesnoaccountoftiming.Thecutoffperiodisarbitrary.*HowdoesonecalculatetheIRRofaproject?Usingeithertrial-and-errororafinancialcalculator,onefindsthediscountratethatproducesanNPVofzero.?Whatisthedifferencebetweenindependentprojectsandmutuallyexclusiveprojects?Anindependentprojectisonewhoseacceptaneedoesnotaffecttheacceptaneeofanother.Amutuallyexclusiveproject,ontheotherhandisonewhoseacceptaneeprecludestheacceptaneeofanother.*WhataretwoproblemswiththeIRRapproachthatapplytobothindependentandmutuallyexclusiveprojects?Thedecisionruledependsonwhetheroneisinvestingoffinancing.Multipleratesofreturnarepossible.*Whataretwoadditionalproblemsapplyingonlytomutuallyexclusiveprojects?TheIRRapproachignoresissuesofscale.TheIRRapproachdoesnotaccommodatethetimingofthecashflowsproperly.6.7?Howdoesonecalculateaprojectsprofitabilityindex?Dividethepresentvalueofthecashflowssubsequenttotheinitialinvestmentbytheinitialinvestment.*Howistheprofitabilityindexappliedtoindependentprojects,mutuallyexclusiveprojects,andsituationsofcapitalrationing?Withindependentprojects,accepttheprojectifthePIisgreaterthan1.0andrejectiflessthan1.0.Withmutuallyexclusiveprojects,useincrementalanalysis,subtractingthecashflowsofproject2fromproject1.FindthePI.IfthePIisgreaterthan1.0,acceptproject1.Iflessthan1.0,acceptproject2.Incapitalrationing,thefirmshouldsimplyranktheprojectsaccordingtotheirrespectivePlsandaccepttheprojectswiththehighestPls,subjecttothebudgetconstrain.AnswerstoEnd-of-ChapterProblemsQUESTIONSANDPROBLEMSThePaybackPeriodRuleFujiSoftware,Inc.,hasthefollowingprojects.YearProjectAProjectB0_$7,500_$5,00014,0002,50023,5001,20031,5003,000SupposeFujiscutoffpaybackperiodistwoyears.Whichofthesetwoprojectsshouldbechosen?SupposeFujiusestheNPVruletorankthesetwoprojects.Iftheappropriatediscountrateis15percent,whichprojectshouldbechosen?a.PaybackperiodofProjectA=1+($7,500-$4,000)/$3,500=2yearsPaybackperiodofProjectB=2+($5,000-$2,500-$1,200)/$3,000=2.43yearsProjectAshouldbechosen.b.NPVa=-$7,500+$4,000/1.15+$3,500/1.152+$1,500/1.153=-$388.96NPVb=-$5,000+$2,500/1.15+$1,200/1.152+$3,000/1.153=$53.83ProjectBshouldbechosen.SupposePeachPavingCompanyinvests$1milliontodayonanewconstructionproject.Theprojectwillgeneratea、nnualcashflowsof$150,000inperpetuity.Theappropriateannualdiscountratefortheprojectis10percent.Whatisthepaybackperiodfortheproject?IfthePeachPavingCompanydesirestohavea10-yearpaybackperiod,shouldtheprojectbeadopted?Whatisthediscountedpaybackperiodfortheproject?c.WhatistheNPVoftheproject?6.2a.Paybackp、eriod=6+$1,000,000-($150,0006)/$150,000=6.67yearsYes,theprojectshouldbeadopted.11$150,000.-.0.10=$974,25912Thediscountedpaybackperiod=11+($1,000,000-$974,259)/($150,000/1.1)=11.54yearsNPV=-$1,000,000+$150,000/0.10=$500,000TheAverageAccountingReturn6.3Theannual,end-of-year,book-investmentaccountsfort

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