What is the net present value of a project with the following cash flows if the
ID: 2718456 • Letter: W
Question
What is the net present value of a project with the following cash flows if the discount rate is 15%?
Year 0 = -$39,400
Year 1 = $12,800
Year 2 = $21,700
Year 3 = $18,100
a. $39.80
b. $42.97
c. $44.16
d. $48.21
e. $48.30
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project has the following cash flows. What is the payback period?
Year 0 = -$92,000
Year 1 = $27,000
Year 2 = $45,800
Year 3 = $16,800
Year 4 = $11,200
a. 2.48 years
b. 2.59 years
c. 2.96 years
d. 3.21 years
e. 3.43 years
Explanation / Answer
a. $39.80 Statemnet showing Cash flows Particulars Time PVf@15% Amount PV Cash Outflows - 1.00 (39,400.00) (39,400.00) PV of Cash outflows (39,400.00) Cash inflows 1.00 0.8696 12,800.00 11,130.43 Cash inflows 2.00 0.7561 21,700.00 16,408.32 Cash inflows 3.00 0.6575 18,100.00 11,901.04 PV of Cash Inflows 39,439.80 NPV 39.80 d. 3.21 years PBP Time Amount Cumulative - (92,000.00) (92,000.00) 1.00 27,000.00 (65,000.00) 2.00 45,800.00 (19,200.00) 3.00 16,800.00 (2,400.00) 4.00 11,200.00 8,800.00 PBP= 3 + 2400/11200 PBP= 3.2143 Years
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