c

Please provide a breakdown of how to manually solve for Np to attain the values shown in the table. Thank you Thank you in advance.

Example: Discounted Payback (i > 0%) Same example: P = $-18M NCF = $3M per year S = $3M Life = 10 years Different returns expected; vary from 5% to 20% 0 = -18 + 3(P/A,i%,np) + 3(P/F,i%,np) Solve for np Use SM terms P = -$18 NCF = $3 each year S= $3 for years 1, ..., 10 0 = PW of initial investment + PW of NCF + PW of S Return, i% 0 5 10 15 20 Payback, np - 5.00 6.26 8.51 15.31 0 =-P + NCF(P/A,1%,np) + S(P/F,3%,np) Example: Discounted Payback (i > 0%) Same example: P = $-18M NCF = $3M per year S = $3M Life = 10 years Different returns expected; vary from 5% to 20% 0 = -18 + 3(P/A,i%,np) + 3(P/F,i%,np) Solve for np Use SM terms P = -$18 NCF = $3 each year S= $3 for years 1, ..., 10 0 = PW of initial investment + PW of NCF + PW of S Return, i% 0 5 10 15 20 Payback, np - 5.00 6.26 8.51 15.31 0 =-P + NCF(P/A,1%,np) + S(P/F,3%,np)