The following is some of the estimated data you have:

• You both decided to finance the project using your own funds.
• The cost of the equipment will be $80,000 and this cost is incurred prior to any cash is received by the project.
• The expected cash inflows are the most variable of the estimates. Your partner is convinced that the firm will receive $14,000 annually for 7 years. You have your doubts. You think it is more reasonable that there will be cash inflows of $14,000 in year 1, then inflows of $16,000 from years 2-4, and then inflows of $17,000 for years 5-7.
• You both agree that after 7 years, the equipment will stop working and can be sold for its parts for about $5,000.
• You both consider a discount rate of 7% but remain open to other future possibilities.

perform net present value (NPV) calculations for the project using your partner's estimates and then using your estimates.