Question
A project requires initial investment of 30 mln at t = 0 (t in years) 20 mln at t=1, and 10 mln after two
A project requires initial investment of 30 mln at t = 0 (t in years) 20 mln at t=1, and 10 mln after two years. Income will be received over a 17-year period beginning from t = 3 with regular annual payment of 5 mln till 20 years (included). (1) Calculate the NPV (Net Present Values) of the project at an effective rate of interest of 3% p.a. (2) What is the new NPV value if we double the level of the interest rate. (3) Calculate the DPP (Discounted Payback Period) of the project at an effective rate of interest of 3% p.a. (4) Calculate the accumulated value of the project at t=20 years.
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