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Plan the cash flow and make an investment plan for the upcoming 20 years in which you maximize the Net Present Value of the company's
Plan the cash flow and make an investment plan for the upcoming 20 years in which you maximize the Net Present Value of the company's cash flows. Cash flows that occurs after 20 years will not be considered and it is important that the balance at the companys bank account never goes below zero.
- The project that costs $120,000 - The required rate of return is 7.5% bond from the investor. NPV for 10 years =$120,000(1+0.075)=$210,000-120,000 = $ 90,000
Have already the investment plan for the first 10 years, but need to continue for 20 years and what is the NPV for 20 years