Altman Hydraulic Corporation will invest $130,000 in a project that will produce

Question

Altman Hydraulic Corporation will invest $130,000 in a project that will produce the cash flow shown below. The cost of capital is 11 percent. (Note that the third year's cash flow is negative.)

What is the net present value of the project? (Round "PV Factor" to 3 decimal places. Round intermediate and final answer to the nearest dollar amount. Negative amount should be indicated by a minus sign. Omit the "$" sign in your response.)

Altman Hydraulic Corporation will invest $130,000 in a project that will produce the cash flow shown below. The cost of capital is 11 percent. (Note that the third year's cash flow is negative.)

Explanation / Answer

NPV = NPV(Rate, CF1...Cf5) +CF0

ie NPV = NPV(11%,40000,50000,-57000,54000,110000) - 130000

ie NPV = $5,790

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