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Social Circle Publications Inc. is considering two new magazine products. The estimated net cash flows from each product are as follow: Year Sound Cellar Pro
Social Circle Publications Inc. is considering two new magazine products. The estimated net cash flows from each product are as follow:
Year | Sound Cellar | Pro Gamer |
1 | 65,000 | 70,000 |
2 | 60,000 | 55,000 |
3 | 25,000 | 35,000 |
4 | 25,000 | 30,000 |
5 | 45,000 | 30,000 |
Total | 220,000 | 220,000 |
Each product requires an investment of $125,000. A rate of 10% has been selected for the net present value analysis.
- Calculate the payback period for the two products.
- Calculate the net present value for the two products.
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