DSC1630 Assignment 4 Due 17 April 2026 - Distinction Guaranteed

QUIZ


3/14/26, 11:03 AM DSC1630-26-S1: Assessment 4



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Assessment 4


Done: Receive a grade




Opened: Sunday, 1 March 2026, 8:00 AM
Closes: Friday, 17 April 2026, 11:00 PM


Assignment 4: 206589

Please work through the following before answering the assignment questions:

Chapters 6, 7 and 8 from the study material, including all the examples, exercises and evaluation exercises.
Self evaluation exercises 4, 5, 6 and Chapter videos under Additional Resources
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Attempts allowed: 3

Grading method: Highest grade


Summary of your previous attempts
Attempt State Marks / 15.00 Grade / 100.00 Review


1Finished15.00100.00
Submitted Saturday, 14 March 2026, 11:01 AM


Highest grade: 100..00.
3/14/26, 10:58 AM

, Assessment 4 (page 1 of 15)


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QUIZ




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An investment with an initial outlay of R500 000 generates five successive annual cash inflows of R75
000, R190 000, R40 000,R150 000 and R180 000 respectively. The cost of capital K is 10% per annum.
The internal rate of return (IRR) is

a. 7,78%.
b. 27,0%.
c. 21,3%.
d. 9,48%.




The IRR is the interest rate that makes the net present value (NPV) of all cash flows equal to zero: N P V
= 75 000 ( 1 + i ) 1 + 190 000 ( 1 + i ) 2 + 40 000 ( 1 + i ) 3 + 150 000 ( 1 + i ) 4 + 180 000 ( 1 + i ) 5 í 500
000 = 0 NPV= (1+i) 1 75000 ௙ + (1+i) 2 190000 ௙ + (1+i) 3 40000 ௙ + (1+i) 4 150000 ௙ + (1+i) 5
180000 ௙ í500000=0 Using a financial calculator (or trialၭ andၭ error), we find i § 0 , 0778 = 7 , 78 %


i§0,0778=7,78%. Calculator steps SHARP: 2ndF CA ĺ ± 500000 DATA ĺ 75000 DATA ĺ 190000 DATA ĺ
40000 DATA ĺ 150000 DATA ĺ 180000 DATA ĺ ON/C ĺ 2ndF CASH ĺ 2ndF CA COMP. HP: ORANGE C ALL
ĺ 1 ORANGE P/YR ĺ 500000 ± CFj ĺ 75000 CFj ĺ 190000 CFj ĺ 40000 CFj ĺ 150000 CFj ĺ 180000 CFj ĺ
ORANGE IRR/YR.




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, Assessment 4 (page 2 of 15)


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3/14/26, 10:58 AM




Question
Answer saved
Marked out of 1.00


An investment with an initial outlay of R500 000 generates five successive annual cash inflows of
R75 000, R190 000, R40 000, R150 000 and R180 000 respectively. The cost of capital K is 10% per
annum.
The net present value (NPV) is approximately

a. R135 000
b. −R135 000.
c. R74 500.
d. −R30 523.


The NPV is calculated by discounting each cash inflow at the cost of capital K = 10
% K=10% and subtracting the initial outlay: N P V = 75 000 1.1 + 190 000 1.1 2 +
40 000 1.1 3 + 150 000 1.1 4 + 180 000 1.1 5 í 500 000 NPV= 1.1 75000 ௙ + 1.1 2
190000 + 1.1 3 40000 ௙ + 1.1 4 150000 ௙௙ + 1.1 5 180000 ௙ í500000 Using the
computed present values: 75 .1


= 68 181.82 75000/1.1=68181.82 190 .1 2 = 157 024.79 190000/1.1 2
=157024.79 40 .1 3 = 30 052.59 40000/1.1 3 =30052.59 150 .1 4 =
102 452.00 150000/1.1 4 =102452.00 180 .1 5 = 111 765.00 180000/1.1 5
=111765.00 Sum of inflows § 469 476.20 469476.20, so N P V = 469 476.20 í 500 000
= í 30 523.80 § í 30 523 NPV=469476.20í500000=í30523.80§í30523


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