University of Central Punjab

Corporate Finance [FIN 6003] November 5, 2018

MBA
Assignment 1 Fall - 2018

Q1.
Year t Project – Sun Project – Lotus
0 -1000 -1000
1 500 100
2 400 300
3 300 400
4 100 600
Assume both project’s cost of capital as 10%.

Calculate:
1. Payback Period for both projects.
2. Discounted Payback Period
3. Net Present Value
4. Internal Rate of Return
5. Profitability Index
6. Plot NPV Profiles for both projects @ 0%, 5%, 10%, 15% and find out Crossover rate.