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Discount rate 8% Assume the project is completed in Year 0Year 1 3 Total Costs Discount factor Discounted costs 140,000 40,00040,000 40,000 1 0.93 0.86 0.79 40,000 37,200 34,400 31,600 243,200 Benefits Discount factor Discounted benefits 0 200,000 200,000 200,000 1 0.93 0.86 0.79 0 186,000 172,000 158,000 516,000 Discounted benefits-costs (140,000) 148,800 137,600 126,400 272,800NP Cumulative benefits - costs (140,000)8,800 146,400 272,800 ROI 112% Payback In Year 1 FIGURE 4-5 JWD Consulting net present value example