Calculate the net present value for a 15 year project with an initial investment

Question

Calculate the net present value for a 15 year project with an initial investment of 5,000 and a cash inflow of 2,000 per year. Assume that the firm has an opportunity cost of 18% ....... Round to nearest cent
Is this project acceptable ?yes or no Calculate the net present value for a 15 year project with an initial investment of 5,000 and a cash inflow of 2,000 per year. Assume that the firm has an opportunity cost of 18% ....... Round to nearest cent
Is this project acceptable ?yes or no
Is this project acceptable ?yes or no

Explanation / Answer

Annual PV factor 15 Years@18%=5.092

Cash inflows per year=$2,000

Present value of total cash flows=5.092*$2,000=10,184

NPV=10,184-5000=$5,184

Project is acceptable

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