Question
Cost of Project $25,000 (Yr0) Discount Rate = 0.05 Cash Inflow -Yr0 = 0, Yr1 =$15,000, Yr2=$30,000, Yr3=40,000, Yr4=$45,000 Cash Outflow -Yr1=$25,000, Yr2=$25,000, Yr3=$25,000; Yr4=$25,000
Cost of Project $25,000 (Yr0) Discount Rate = 0.05 Cash Inflow -Yr0 = 0, Yr1 =$15,000, Yr2=$30,000, Yr3=40,000, Yr4=$45,000 Cash Outflow -Yr1=$25,000, Yr2=$25,000, Yr3=$25,000; Yr4=$25,000 NPV = -I0 + (Net Cash Flow / (1 + r)t) Where: I = Total Cost or Investment of the Project r = discount rate t = time period What is the net present value?
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Financial Accounting An Introduction
Authors: Pauline Weetman
7th Edition
1292086696, 978-1292086699
