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Could anyone explain this excercise? How did they get the Cummulative PV? 9. You are thinking about opening your own business. You expect the following

image text in transcribedCould anyone explain this excercise? How did they get the Cummulative PV?

9. You are thinking about opening your own business. You expect the following total cash flows from this project. Assume 10% as the required return. c.1 +1.0, 1.1 3+300,000500,000100,000200,00090,000=3,5(years)4 b. What is the discounted payback? 500,000+90,909+165,289+37,566+204,904=1,332 Never Payback # c. What is the net present value? NPV=500,000+90,909+165,289+37,566+204,904=1,332 d. What is the profitability index? D=500,00090,909+165,289+37,566+204,904=0,9974

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