VU VICKY Virtual University Assignment Solution, Past Papers, Handouts and other material

Growth Model.

Po=Do(1+8)

         (le-g)

1-       Po=3.20(1+0%)

         (12%-0%)

=3.201

   0.12

Po=26.67

2-      Po=3.20(1+4%)

         (12%-4%)

=3.20(1.04)

   8%

=3.328/0.08

=416

3-      3 Years

4-      Po=3.81(1+4%)

         (18%-4%)

                       =3.9624

                       =49.53

                                                         1                         2                            3                            4

Do          3.201(1+6%)             3.392                  3.6                       3.81                        49.53

Total Po =60.332

Working =3.92+3.6+3.81+49.53

                                =60.332

       Years                  0              1                   2                           3                  4       5                              6              7              8

Revenue                            50000          50000                 50000    50000  50000                    50000    50000    50000

Cost                                     30000          30000                 30000    30000  30000                    30000    30000    30000

Profit                                   20000          20000                 20000    20000  20000                    20000    20000    20000   

PPE (SV)                             5000

Initial Cost assumption    (80000)

                              0              1                   2                           3                  4       5              6              7              8             

D.F(10%)            1              0.909           0.806                  0.751     0.683   0.621     0.564     0.513     0.467

Dv                         (80000) 18180          16520                 15020    13660  12420    11280    10260    11675

NPV                     32015+fearable

Payback             Y              C.F               ACF

                              0              (80000)       (80000)

                              1              18180          (61820)                                  

                              2              16520          (45300)

                              3              15020          (30280)

                              4              13660          (16620)

                              5              12420          (4200)

Payback=5years+4800/11280

                              =5years+0.37year

                              =5.37 years

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