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Net Present Value MBA Company has the opportunity to est in three y proyectis expected to the following net cash inflows: Year 1 2 3

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Net Present Value MBA Company has the opportunity to est in three y proyectis expected to the following net cash inflows: Year 1 2 3 Net Cash Flows Uneven $100,000 200,000 200,000 300.000 200.00 Total $600.000 5600.000 Even 200 300 MBA's cost of capital is 14%. Required: 1. Determine the maximum amount MBA would be willing to invest on this project 2 If the cash flows were $200,000 per year, by how much would your answer change 2. If the 1. Uneven Cash Flows: Year FCF PVDF (14%) PV 1 = $ 2 3 Maximum to Invest PVDF (14%) PV 2. Annuity-Equal Cash Flows: Year FCF 1-3 Maximum to Invest S Comparison Uneven Cash Flows Annuity (Equal) Cash Flows S Difference

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